Short answer: Opening an electrical contracting business in Texas touches six offices: the Secretary of State, the place you file an assumed name, the Comptroller, the IRS, TDLR and the Texas Department of Insurance. Each answers a different question. A company filing or a tax number does not license electrical work; the TDLR Electrical Contractor license does.
Who handles what
| Office | What it handles | What it does not do | Official page | Checked |
|---|---|---|---|---|
| Texas Secretary of State | Business structures. A sole proprietorship is an individual doing business without formal organization; Texas LLCs and corporations are created by filing a certificate of formation. | It cannot choose the best structure for you. An S corporation is a federal tax election, not a separate Texas entity. | Business structures, Formation FAQs | October 2026 |
| Assumed name | Public notice when the business uses a name different from its legal name. Follow current Secretary of State guidance for where to file. | It does not create exclusive rights to the name. | Name filings FAQs | October 2026 |
| Texas Comptroller | The sales tax permit for a business that sells or leases tangible personal property or sells taxable services, and franchise tax information. | The permit page alone does not settle how a specific electrical contract is taxed. Ask a CPA. | Sales tax permit, Franchise tax | October 2026 |
| IRS | The federal EIN. Register the entity with the state first, use the name on the formation documents, and get the EIN directly from the IRS for free. | An EIN does not license electrical work. | EIN page | October 2026 |
| TDLR | The Electrical Contractor license: a Master Electrician of record, liability insurance, workers compensation proof or election, and a $110 application. | It does not form your company or issue tax numbers. | Electrical Contractor page | October 2026 |
| Texas Department of Insurance | Workers compensation choices for Texas employers and the duties that follow the choice. | It does not issue your contractor license. | Coverage for employers | October 2026 |
A working order
- Decide the business structure with a CPA or attorney. Write down owners, who manages, liability and tax questions.
- If you form an LLC or corporation, file the certificate of formation with the Secretary of State.
- If you will work under a name other than the legal name, file the assumed name where current guidance says.
- Apply for the EIN after the entity exists, using the name on the formation documents.
- Ask whether a Texas sales tax permit applies to the work you will sell.
- Line up the Master of record and insurance, then apply to TDLR. The Texas Electrical Contractor license guide lists the official forms and lookups.
- Make the workers compensation choice and keep the proof with the license file.
Want each step as a worksheet? The Texas business setup checklist covers structure, formation, EIN, sales tax and where to keep each record.
First job intake checklist
Ask these before you quote. Write the answers down and have the customer confirm the scope in writing.
| Ask | Why it matters |
|---|---|
| Where is the job: address, city and county? | Permits and inspections are handled locally. Call the local permitting office before you bid. |
| What type of work: new install, remodel, service change, repair? | It decides the permit type and the crew you need. |
| Who is the customer and who signs? | The person who asks for the work is not always the person who can approve it or pay for it. |
| What does the customer expect, and by when? | Write the finished result in one sentence the customer agrees with. |
| Who owns the site and who can grant access and shutoffs? | You need permission to enter and to turn power off. |
| Does the customer want your certificate of insurance? | Send the current one, and keep a copy in the job file. |
| What is outside the scope? | List what you will not do and what you will not promise, such as a finish date before the permit is issued. |
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Sources checked October 2026
- Texas Secretary of State, business structures: https://www.sos.state.tx.us/corp/businessstructure.shtml
- Texas Secretary of State, formation FAQs: https://www.sos.state.tx.us/corp/formationfaqs.shtml
- Texas Secretary of State, name filings FAQs: https://www.sos.state.tx.us/corp/namefilingsfaqs.shtml
- Texas Comptroller, sales tax permit: https://comptroller.texas.gov/taxes/permit/
- Texas Comptroller, franchise tax: https://comptroller.texas.gov/taxes/franchise/
- IRS, Employer Identification Number: https://www.irs.gov/businesses/employer-identification-number
- TDLR Electrical Contractor application page: https://www.tdlr.texas.gov/electricians/apply/businesses/contractor-elec.htm
- Texas Department of Insurance, workers compensation coverage for employers: https://www.tdi.texas.gov/wc/employer/coverage.html
