Members may be individuals, partnerships, corporations, and any other type of legal entity. Taxes: LLCs are subject to a state franchise tax.Formation of Business Entities and Nonprofit Corporations Under the Texas Business Organizations Code: Online filing available through SOSDirect. The limited liability company (hereinafter LLC) is neither a corporation nor a partnership; rather, it is a distinct type of entity. This video provides a step-by-step guide on completing the Certificate of Formation (Form 205) for a Texas LLC. Each state may use different regulations, you should check with your state.