Starting a business in Texas can offer strong opportunities for foreign nationals. However, there are legal steps that every non-citizen must follow to stay compliant.
It is important to carefully manage your immigration status, business registration and tax situation to avoid problems later.
Choose the right business structure
Foreign nationals often choose to form a limited liability company (LLC) or a corporation. Both options offer limited personal liability and allow business owners to open U.S. bank accounts. Texas allows non-citizens to own and operate businesses, but they must register the company with the Texas Secretary of State. The business also needs a physical Texas address.
Check visa and immigration status
Not every visa allows a person to run a business. For example, a B-1 visitor visa does not give work or business operation rights. E-2 investor visas and certain employment-based visas can allow business activity. Before launching a company, foreign nationals must confirm that their immigration status allows business ownership or self-employment. Violating visa terms can result in removal from the country.
Apply for an EIN and open a bank account
The business must apply for an Employer Identification Number (EIN) through the Internal Revenue Service (IRS). This number works like a Social Security number for the business. Banks in Texas usually require an EIN and business formation documents to open a business account. Some banks may also ask for a U.S.-based co-owner or officer.
Follow tax and reporting requirements
All businesses in Texas must pay applicable state and federal taxes. Franchise tax, sales tax and employment taxes may apply depending on the type of business. The owner must file regular reports with the Texas Comptroller and the IRS. The business must also keep clear financial records and meet bookkeeping standards.
Laws and visa rules can change. Business owners must monitor changes that could affect company operations or immigration status. Keeping up with these changes can prevent legal issues in the future.
