Texas LLC Certificate of Conversion

Jeramie Fortenberry, J.D., LL.M.

Jeramie Fortenberry, J.D., LL.M.

Attorney

Published Jun 26, 2023 Last updated Jul 10, 2023

Texas law authorizes a legal process—called a Texas LLC conversion—that can change a business’s official home state (its domicile) or change its entity structure (corporation to LLC, for example).1 A conversion that changes an out-of-state LLC into a Texas LLC (or vice versa) is sometimes called a Texas LLC domestication, but the official term under Texas law is conversion.2

Completing and filing a certificate of conversion is a key part of the Texas LLC conversion process. An out-of-state LLC becomes a Texas LLC governed by Texas law by completing the entire conversion process and filing a certificate of conversion with the Texas Secretary of State.3

What is a Texas LLC Certificate of Conversion?

A Texas LLC certificate of conversion is a legally required form that an LLC must file to complete a conversion to Texas or from Texas to another state.4 When an out-of-state LLC transfers to Texas, its new Texas certificate of formation is filed with the Texas Secretary of State alongside the certificate of conversion.5 After the conversion documents are filed and accepted, the conversion becomes part of the public record so that third parties have legal notice that the LLC is now a Texas LLC.

What Information Must a Texas Certificate of Conversion Include?

Texas law lists the information that an LLC’s certificate of conversion must include.6 An LLC converting to Texas can either include its Texas plan of conversion within the certificate of conversion or certify in the certificate of conversion:

  • The company’s name, entity structure, and state before the conversion;
  • The name and entity structure the company will use in Texas after the conversion;
  • That the plan of conversion is on file at the LLC’s current principal place of business (the address of which must be included);
  • That the plan of conversion will be on file at the LLC’s principal place of business in Texas after the conversion (the address of which must be included); and
  • That, upon reasonable request, the out-of-state LLC will provide a copy of the plan of conversion (or the Texas LLC will provide a copy after the conversion) without cost to any owner or member of the LLC.

Regardless of whether the LLC opts to attach its plan of conversion or list the above items, the certificate of conversion must state that the plan of conversion has been approved under the laws of the original state and under the LLC’s pre-conversion governing documents.7

What Information Must a Converting LLC’s Texas Certificate of Formation Include?

An out-of-state LLC converting to Texas files a formation document—called a certificate of formation—together with its certificate of conversion.8 A newly formed Texas LLC also must file a certificate of formation. When filed by an out-of-state LLC converting to Texas, the certificate of formation must include:

  • The name of the LLC in Texas;
  • The Texas LLC’s registered agent and registered office;
  • The LLC’s management structure (member-managed or manager-managed);
  • The LLC’s duration and purpose (most LLCs use the Texas default language: “any and all lawful purposes for which a limited liability company may be organized under the Texas Business Organizations Code”); and
  • Special language connecting the new Texas LLC to the original out-of-state LLC (usually included in the Supplemental Provisions section).9

How Does an LLC Sign and File its Texas Certificate of Conversion?

A converting LLC’s certificate of conversion and certificate of formation must be signed on behalf of the LLC.10 The signer must be a person who has official authority to act for the company. That typically means an officer, manager, or member of the LLC.11

The LLC files the completed, signed certificate of conversion and certificate of formation with the Texas Secretary of State’s office. The Secretary of State accepts the filings in person, via mail, or by fax. The SOSDirect e-filing system is not available for conversions.

The LLC must pay the filing fees for the certificate of conversion and certificate of formation when the documents are filed. The total fee is $600.00—made up of a $300.00 filing fee for each of the documents.12

When is a Texas LLC Certificate of Conversion Effective?

A Texas LLC certificate of conversion ordinarily takes effect—and the company officially becomes a Texas LLC—when the certificate of conversion and certificate of formation are filed and accepted by the Texas Secretary of State.13 The owners can opt to have the conversion become effective in the future by listing a delayed effective date in the filings.14 Texas law allows a delayed effective date to be up to 90 days after the certificate of formation and certificate of conversion are signed.15

What are the Other Steps in the Texas LLC Domestication Process

A Texas LLC conversion requires multiple steps. Preparing and filing the certificate of conversion occurs near the end of the process. An out-of-state LLC must complete all steps to successfully convert into a Texas LLC:

  • Create a plan of conversion;16
  • Officially adopt the plan of conversion;17
  • Prepare a certificate of conversion;
  • Prepare a certificate of formation;
  • File the certificate of conversion and certificate of formation with the Texas Secretary of State;
  • File the current state’s equivalent to the certificate of conversion with the current state’s filing office; and
  • Adopt a new Texas company agreement (the equivalent in Texas of operating agreements in other states).18

The converting LLC continues to exist throughout the entire conversion process. It still has the same assets and liabilities and contractual rights and obligations after the conversion.19 The business continues its tax history and can continue using the same Employer Identification Number (EIN).

  1. Tex. Bus. Orgs. Code Ann. §§ 10.101; 10.102.
  2. See Tex. Bus. Orgs. Code Ann. § 1.002(10).
  3. See Tex. Bus. Orgs. Code Ann. §§ 101.101, et. seq.
  4. Tex. Bus. Orgs. Code Ann. § 10.154(a).
  5. Tex. Bus. Orgs. Code Ann. § 10.155(a).
  6. Tex. Bus. Orgs. Code Ann. § 10.154(b).
  7. Tex. Bus. Orgs. Code Ann. § 10.154(b)(2).
  8. Tex. Bus. Orgs. Code Ann. § 10.155.
  9. Tex. Bus. Orgs. Code Ann. § 3.005.
  10. Tex. Bus. Orgs. Code Ann. § 10.154(b).
  11. See Tex. Bus. Orgs. Code Ann. § 101.0515.
  12. Tex. Bus. Orgs. Code Ann. §§ 4.151(5); 4.152(1); 4.154.
  13. Tex. Bus. Orgs. Code Ann. § 10.105.
  14. Tex. Bus. Org. Code § 4.052.
  15. Tex. Bus. Org. Code § 4.053.
  16. Tex. Bus. Orgs. Code Ann. § 10.103.
  17. Tex. Bus. Orgs. Code Ann. § 10.102.
  18. Tex. Bus. Orgs. Code Ann. § 101.001(1).
  19. Tex. Bus. Orgs. Code Ann. § 10.106.