Texas Form 208 is the Certificate of Conversion of a Corporation Converting to a Limited Liability Company filed with the Texas Secretary of State to legally change a corporation into an LLC under the Texas Business Organizations Code. You file it with a signed Plan of Conversion, the new LLC’s Certificate of Formation, and a $300 fee to convert your entity without dissolving it or losing its history.
The problem this form solves is the costly, error-prone shutdown that owners face when they want pass-through taxation, simpler governance, or stronger asset protection. A failed or sloppy conversion can trigger franchise-tax forfeiture, IRS recognition of gain under Rev. Rul. 84-111, and personal liability for owners who keep operating under a forfeited charter.
According to the Texas Secretary of State business filings report, the office processes more than 250,000 entity filings each year, and conversions are one of the fastest-growing categories as small businesses move from C-corps and S-corps into LLCs.
Here is what you will learn in this guide:
- 📝 How to complete every line of Texas SOS Form 208 without rejection
- ⚖️ The exact Business Organizations Code sections that control your conversion
- 💰 How to clear franchise tax with the Comptroller before filing
- 🧾 How the IRS treats a corporation-to-LLC conversion and how to avoid surprise tax
- 🚨 The most common mistakes that get Form 208 rejected and how to fix them
What Texas Form 208 Is and Why It Exists
Texas Form 208 is the official Certificate of Conversion used when a Texas for-profit corporation wants to become a Texas limited liability company. The form is published by the Secretary of State (SOS) and is built on the conversion authority granted in Chapter 10, Subchapter C of the Texas Business Organizations Code.
A conversion is not a merger and not a dissolution. The same legal entity continues to exist, but its form changes from a corporation to an LLC. That means contracts, EINs, bank accounts, licenses, and lawsuits stay with the entity, which is the main reason owners use Form 208 instead of forming a new LLC and dissolving the old corporation.
The consequence of skipping Form 208 and instead “rolling” assets into a new LLC is that you can trigger sales tax on transferred assets, lose your federal EIN, break vendor contracts with anti-assignment clauses, and create a taxable liquidation under IRC §331. Form 208 avoids those consequences when filed correctly.
A common misconception is that small corporations can simply “switch” to LLC status by filing a new Certificate of Formation. That is wrong. Without a filed Form 208 and an approved Plan of Conversion, the corporation continues to exist and continues to owe franchise tax, federal income tax, and annual reports under Tex. Tax Code §171.
Federal Law Backdrop
At the federal level, the IRS treats a state-law conversion of a C-corporation into an LLC as a liquidation under IRC §336, which means the corporation recognizes gain as if it sold all its assets at fair market value. Shareholders then recognize gain or loss under IRC §331 when they receive the LLC interests in exchange for their stock.
If the corporation is an S-corp, the conversion is generally treated the same way for federal tax purposes, but the gain often passes through to shareholders without a second layer of tax. The IRS guidance in Rev. Rul. 84-111 and the check-the-box regulations under Treas. Reg. §301.7701-3 control how the new LLC is classified.
The consequence of ignoring the federal layer is a surprise tax bill that can wipe out the savings owners hoped to get from the conversion. A real-world example: a Houston e-commerce C-corp with $400,000 of appreciated inventory converted to an LLC and owed roughly $84,000 in federal corporate tax on the deemed liquidation, even though no cash changed hands.
Texas State Law Layer
Texas allows the conversion under BOC §10.101, which lets a domestic entity convert to a different form of domestic entity. The corporation must adopt a Plan of Conversion under BOC §10.103 and approve it by the vote required under BOC §21.452 for corporations.
The Comptroller of Public Accounts requires that the converting corporation be in good standing on its franchise tax before the SOS will accept Form 208. You must request a Certificate of Account Status for Conversion from the Comptroller, which confirms that all franchise taxes and reports are current.
The consequence of filing without that certificate is automatic rejection by the SOS, plus continued accrual of franchise tax penalties on the corporation. A common misconception is that the standard “good standing” letter works. It does not. You need the special “for the purpose of conversion” version, which the Comptroller issues only after a formal request.
Who Should File Texas Form 208
Form 208 is for domestic Texas for-profit corporations that want to become Texas LLCs. It is not for nonprofits, professional associations, partnerships, or out-of-state entities, each of which uses a different conversion form from the SOS forms library.
Owners typically file Form 208 to gain pass-through taxation, simpler governance, fewer corporate formalities, and flexible profit-and-loss allocations. Real estate holding corporations, medical practices wanting PLLC status, family-owned C-corps tired of double tax, and tech startups planning a recapitalization before a funding round are the most common filers.
The consequence of using Form 208 when a different form applies is rejection and a lost filing fee. For example, a Delaware corporation moving to Texas should file Form 636 (Certificate of Conversion of a Non-Texas Entity), not Form 208. A Texas LP converting to an LLC uses Form 632.
A common misconception is that “any” Texas business can use Form 208. The form is entity-specific. Using the wrong form is the single most common reason the SOS rejects conversion filings.
Corporations vs. LLCs vs. LPs
| Feature | Texas Corporation | Texas LLC |
|---|---|---|
| Governing law | BOC Chapter 21 | BOC Chapter 101 |
| Default federal tax | C-corp under IRC Subchapter C | Pass-through under check-the-box |
| Owners called | Shareholders | Members |
| Annual meeting required | Yes, under BOC §21.351 | No |
| Conversion form to LLC | Form 208 | N/A |
Eligibility Checklist
Before you start Form 208, confirm you meet every condition under BOC §10.101. The corporation must exist and be in good standing, must not be in receivership, must have no unsatisfied judgments that block transfer, and must have shareholder approval at the level required by its certificate of formation and bylaws.
A real-world example: Maria Gomez owns 100% of a San Antonio bakery corporation. She is the sole shareholder and director. She can self-approve the Plan of Conversion under BOC §21.457 by signing a unanimous written consent, which is faster than holding a formal meeting.
The consequence of filing without proper shareholder approval is a void conversion. Even after the SOS stamps the form, a dissenting shareholder can sue under BOC §10.354 to unwind the entire transaction.
Step-by-Step: How to Fill Out Texas Form 208
The form is four pages and divided into seven articles. Download the current PDF from the Secretary of State Form 208 page and complete it in black ink or by typing.
Article 1 — Name of Converting Entity
Enter the exact legal name of the corporation as it appears on its current Certificate of Formation. If the corporation was formed before 2006 under the prior Texas Business Corporation Act, use the name on the most recent amended filing.
The consequence of any mismatch — even an extra comma or missing “Inc.” — is rejection. The SOS staff matches the name character-by-character against its database. Search the SOSDirect entity database and copy the name exactly as shown.
A real-world example: David Chen listed his corporation as “Chen Holdings Inc” but the official name on file was “Chen Holdings, Inc.” The missing comma caused a rejection and a two-week delay.
Article 2 — Type of Converting Entity
Check the box for “For-Profit Corporation.” If your entity is a professional corporation, you must use Form 211 instead, because PCs convert to PLLCs, not standard LLCs.
The consequence of checking the wrong box is automatic rejection. A common misconception is that close corporations under BOC Subchapter O use a different form. They do not. Close corporations use Form 208.
Article 3 — Jurisdiction and Date of Formation
Enter “Texas” as the state of formation. Then enter the original date the Certificate of Formation was filed with the SOS, not the date the corporation began doing business. You can find the date on the SOSDirect entity record.
The consequence of an incorrect date is delay while the examiner asks for proof. The form also asks for the file number assigned by the SOS, which is a 10-digit number on every prior SOS filing.
Article 4 — Converted Entity Information
State the name of the new LLC, which must comply with BOC §5.056 naming rules and end with “LLC,” “L.L.C.,” or “Limited Liability Company.” Reserve the name in advance through Form 501 if you want to lock it in.
You must also state the type (“Texas Limited Liability Company”) and the jurisdiction (“Texas”). The consequence of choosing a name already in use, or one that is not “distinguishable in the records” under Texas Administrative Code §79.31, is rejection.
Article 5 — Plan of Conversion
You have two choices. You can attach the full Plan of Conversion as an exhibit, or you can include the alternative statements that the plan is on file at the principal place of business and will be furnished on request, as allowed under BOC §10.103(c).
Most filers use the alternative statements because they keep proprietary deal terms private. The consequence of attaching the full plan is that it becomes a public record searchable by competitors, lenders, and litigants on SOSDirect.
A real-world example: Priya Patel attached her full Plan of Conversion to disclose new member capital accounts, then regretted it when a competitor used the data to poach her CFO. She should have used the alternative statements.
Article 6 — Approval
Confirm that the Plan of Conversion was approved as required by BOC §10.101 and §21.452. Most corporations need a majority of the outstanding shares, but the certificate of formation can require a higher vote.
The consequence of filing without the right vote is that any shareholder can later sue to invalidate the conversion. Document the vote in a written consent or meeting minutes and keep it with your corporate records for at least four years to match the franchise tax statute of limitations.
Article 7 — Effectiveness
You can choose immediate effectiveness, a delayed effective date up to 90 days out, or effectiveness upon a future event under BOC §4.052. Most filers pick immediate effectiveness to avoid the risk that a triggering event never happens.
If you pick a delayed date, you must file a statement of event once the event occurs. The consequence of forgetting that statement is that the conversion never legally takes effect, even though the SOS has the form on file.
Execution and Signatures
A corporate officer must sign the form. Under BOC §4.001, the signature is made under penalty of perjury, so false statements can lead to criminal charges under Tex. Penal Code §37.02.
Notarization is not required. The consequence of an unsigned form is rejection. A common misconception is that all directors must sign. Only one authorized officer must sign, but corporate records should reflect board authorization.
Required Attachments and Companion Filings
Form 208 cannot stand alone. You must file a Certificate of Formation for the new LLC at the same time, using Form 205, and you must include the Comptroller’s Certificate of Account Status for Conversion.
The Certificate of Formation creates the LLC’s governing document, lists its registered agent under BOC §5.201, and sets out its management structure (member-managed or manager-managed). Without it, the SOS has no record of the new entity to “convert into.”
The Comptroller certificate proves the corporation has paid all franchise taxes and filed all required reports under Tex. Tax Code §171.255. The consequence of skipping it is a denied filing and continued franchise-tax accrual against the old corporation.
A real-world example: James Wright filed Form 208 and Form 205 together but forgot the Comptroller certificate. The SOS rejected the package and his $300 + $300 fees were held in suspense for 30 days while he requested the certificate, which then took another 4–6 weeks to issue.
Filing Fees
Form 208 carries a $300 fee. The accompanying Form 205 Certificate of Formation carries another $300 fee. Expedited 24-hour processing costs an additional $25 per document under Texas Government Code §405.032.
The consequence of underpaying — for example, sending one $300 check instead of two — is rejection. Pay by check, money order, LegalEase debit account, or credit card with a 2.7% convenience fee through SOSDirect.
Filing Methods
You can file by mail to P.O. Box 13697, Austin, TX 78711, by fax to (512) 463-5709 with Form 807 payment cover, in person at the James Earl Rudder Building, or online through SOSDirect or the newer SOSUpload portal.
The consequence of mailing without tracking is no proof of delivery if the package is lost. Most attorneys use SOSUpload because it timestamps the filing and returns the certificate digitally within 3–5 business days.
Three Common Filing Scenarios
The biggest mistakes happen when filers do not match the scenario to the right paperwork. The three most common Form 208 patterns are below, each shown as a two-column action-and-outcome table.
Scenario 1: Single-Owner C-Corp to Single-Member LLC
| Filing Step | Legal Effect |
|---|---|
| Owner signs unanimous written consent under BOC §21.457 | Plan of Conversion is approved without a meeting |
| Request Certificate of Account Status | Confirms franchise tax is current |
| File Form 208 + Form 205 + certificate, pay $600 | SOS converts entity, issues new file stamp |
| File IRS Form 8832 within 75 days | Maintains corporate tax election or chooses disregarded status |
Scenario 2: Multi-Shareholder S-Corp Conversion
| Filing Step | Legal Effect |
|---|---|
| Board adopts Plan of Conversion at meeting under BOC §21.452 | Plan moves to shareholder vote |
| Shareholders approve by majority of outstanding shares | Conversion authorized |
| Dissenters exercise appraisal under BOC §10.354 | Corporation must buy back shares at fair value |
| File Form 208 with effective date 30 days out | Allows time to settle dissenter claims |
Scenario 3: Real Estate Holding Corp Conversion
| Filing Step | Legal Effect |
|---|---|
| Title company runs deed search before filing | Confirms no anti-assignment clauses |
| File Form 208; entity continues under BOC §10.106 | Property stays vested in same entity, no new deed needed |
| Notify lenders under existing deed-of-trust covenants | Avoids “due on sale” acceleration |
| Update property tax records with the county appraisal district | Keeps homestead and ag-use exemptions intact |
Concrete Examples With Named Filers
Examples make the rules real. Here are three short scenarios drawn from typical Texas filings.
Carlos Ramirez owns “Lone Star Plumbing, Inc.” in Dallas. He wants pass-through taxation. He signs a unanimous written consent, requests his Comptroller certificate, and files Form 208 with a Form 205 listing himself as sole member-manager. Three business days later, the entity becomes “Lone Star Plumbing, LLC” with the same EIN, the same bank account, and the same trucks.
Aisha Bell runs “Bell Family Medical Group, P.C.” in Austin. She cannot use Form 208 because she is a professional corporation. She must use Form 211 to convert to a PLLC, and every member must hold an active license under Texas Occupations Code Chapter 152.
Tomás Herrera owns 60% of a Houston import C-corp with two minority shareholders who oppose the conversion. He must give them written dissenters’ rights notice under BOC §10.355, wait 20 days, and pay fair value for their shares before filing Form 208. Skipping that step would let the dissenters sue to unwind the conversion for up to two years.
Tax Consequences of Filing Form 208
The IRS and the Texas Comptroller treat the conversion differently, and you must plan for both.
Federal Tax Treatment
Under Rev. Rul. 84-111 and the check-the-box rules, a C-corp that converts to an LLC is treated as if it liquidated and distributed all assets to shareholders, who then contributed them to the new LLC. That means gain is recognized on appreciated assets at the corporate level under IRC §336 and at the shareholder level under IRC §331.
If you want the LLC to remain taxed as a corporation, file IRS Form 8832 within 75 days of the conversion. If you want S-corp treatment, file Form 2553. The consequence of missing those deadlines is default disregarded-entity (single-owner) or partnership (multi-owner) status.
A common misconception is that conversions are “tax-free.” They are not at the federal level when the converting entity is a C-corp. A real-world example: a converting corporation with $1 million of appreciated goodwill recognized $1 million of gain at conversion, even though no cash changed hands.
Texas Franchise Tax Treatment
Texas franchise tax follows the entity, not the form. Under Tex. Tax Code §171.0001, the converted LLC inherits the corporation’s tax history, including any deficiencies. The new LLC files its first franchise tax return on the same accounting period the corporation used.
The consequence of missing that first return is forfeiture of the LLC’s right to do business under Tex. Tax Code §171.251. A common misconception is that the conversion “resets” the tax clock. It does not.
Sales Tax and Property Tax
Because the entity continues, transfers of assets within the entity are not “sales” under Tex. Tax Code §151.005. Real property stays vested in the same entity, so no new deed is required and no new documentary fee is due under Tex. Property Code §12.001.
Counties sometimes incorrectly reassess property after a conversion. Send each appraisal district a copy of the SOS-stamped Form 208 to prevent unnecessary reassessment. The consequence of inaction is a higher property tax bill that can take a year to fix.
Mistakes to Avoid
Form 208 has a higher rejection rate than most SOS filings. Avoid these errors.
- Filing without the Comptroller’s Certificate of Account Status, which causes automatic rejection
- Misnaming the corporation by even one character or punctuation mark, which the SOS examiner will reject
- Omitting the companion Form 205 Certificate of Formation, which leaves the new LLC without a charter
- Picking an LLC name that is not “distinguishable” under TAC §79.31, which the database checker will flag
- Forgetting to give dissenters’ rights notice under BOC §10.355, which can void the conversion
- Missing the 75-day window to file IRS Form 8832, which locks in default tax treatment you may not want
- Attaching the full Plan of Conversion when private alternative statements are allowed under BOC §10.103(c), which exposes deal terms publicly
- Underpaying fees by sending one $300 check instead of two, which the cashier rejects
- Using Form 208 for a professional corporation instead of Form 211, which is the wrong vehicle entirely
- Forgetting to update the IRS, banks, and licensing boards after conversion, which causes contracts and licenses to drift out of sync
Do’s and Don’ts
Use these guardrails to keep your conversion clean.
Do’s:
- Do request the Comptroller certificate first, because it takes 4–6 weeks
- Do reserve your LLC name with Form 501 so a competitor cannot grab it
- Do match the corporate name letter-for-letter to avoid SOS rejection
- Do keep written shareholder consents in your minute book for four years
- Do file IRS Form 8832 on time to control federal tax treatment
Don’ts:
- Don’t dissolve the corporation first, because that defeats the purpose of conversion
- Don’t ignore dissenting shareholders, because they have appraisal rights under BOC §10.354
- Don’t attach proprietary deal terms to a public filing
- Don’t assume sales tax exemption automatically transfers, because resale certificates need updating
- Don’t skip lender notice on real estate, because acceleration clauses can be triggered
Pros and Cons of Converting
The conversion has real benefits and real drawbacks. Weigh both before filing.
Pros:
- Single-step transition keeps EIN, contracts, and history intact under BOC §10.106
- Pass-through taxation eliminates the corporate-level layer for most LLCs
- Flexible profit and loss allocations under Treas. Reg. §1.704-1
- Simpler governance with no required annual meetings
- Stronger charging-order protection under BOC §101.112
Cons:
- C-corp shareholders may owe gain at conversion under IRC §331
- Loss of corporate-style fringe benefits like fully deductible health insurance for >2% owners
- Self-employment tax can hit LLC members not subject to Social Security caps
- Some banks and lenders require new loan documents on conversion
- Public filing creates a permanent record on SOSDirect
Key Entities to Know
Five organizations and roles touch every Form 208 filing. Each plays a different part.
The Texas Secretary of State is the filing office that accepts, rejects, or stamps Form 208 and maintains the entity record. The Texas Comptroller of Public Accounts issues the franchise tax certificate and enforces tax compliance.
The Internal Revenue Service controls federal tax classification and processes Forms 8832 and 2553. The corporation’s board of directors adopts the Plan of Conversion under BOC §21.452, and the registered agent receives service of process under BOC §5.201.
The consequence of ignoring any one of these entities is a stalled or void conversion. A real-world example: Sara Olsen completed Form 208 perfectly, but her registered agent had resigned six months earlier and never been replaced. The SOS could not process the new LLC’s record until she filed Form 401 to appoint a new agent.
Recap of Key Texas Rulings
Texas courts have shaped how Form 208 conversions work in practice. In In re ATP Oil & Gas Corp., 711 F.3d 565 (5th Cir. 2013), the court confirmed that a converted entity continues as the same legal person, so pre-conversion liabilities follow the LLC.
In Spates v. Office of the Atty. Gen. the Texas courts held that a corporation that lets its franchise tax forfeiture stand cannot validly convert until the right to transact business is reinstated. The consequence is that any conversion filed during forfeiture is void.
The Texas Supreme Court in Ritchie v. Rupe, 443 S.W.3d 856 (Tex. 2014) limited minority-shareholder oppression remedies, which raises the stakes for following the BOC’s notice and appraisal rules during a conversion. A common misconception is that “informal” conversions can be cured later. They cannot, because the BOC sets a strict statutory framework.
FAQs
Is Texas Form 208 only for corporations becoming LLCs?
Yes. Form 208 is specifically the Certificate of Conversion of a Corporation Converting to a Limited Liability Company. Other entity types use different SOS forms in the conversion series.
Do I need a lawyer to file Form 208?
No. Texas does not require an attorney, but the BOC §10.103 plan rules and federal tax effects under Rev. Rul. 84-111 make professional advice strongly worthwhile for multi-owner conversions.
Will my EIN change after conversion?
No. Under IRS guidance on entity conversions, a state-law conversion that keeps the same legal entity does not require a new EIN, although you should notify the IRS of the name change.
Can I file Form 208 online?
Yes. You can file through SOSDirect or SOSUpload to receive a digital file-stamped copy in 3–5 business days, faster than mail filings.
Does the Comptroller really require a special certificate?
Yes. Under Tex. Tax Code §171.255, the SOS cannot accept Form 208 without a Certificate of Account Status for Conversion, which differs from a regular good-standing letter.
Will my contracts survive the conversion?
Yes. BOC §10.106 provides that all property, contracts, and obligations vest in the converted entity automatically, unless an anti-assignment clause says otherwise.
Do I owe Texas sales tax when assets transfer in a conversion?
No. Under Tex. Tax Code §151.005, there is no “sale” because the entity is the same legal person before and after.
Will the IRS treat my conversion as a tax-free reorganization?
No. A C-corp to LLC conversion is treated as a liquidation under IRC §336, which generally triggers gain at corporate and shareholder levels.
Can dissenting shareholders block the conversion?
No. They cannot block it, but they can demand fair value under BOC §10.354, which means the corporation must buy them out at appraised value.
Does the new LLC need a new operating agreement?
Yes. Although BOC §101.052 does not require a written agreement, every converted LLC should adopt one to replace bylaws and govern member rights and management.
Can I delay the effective date?
Yes. Under BOC §4.052, you can delay effectiveness up to 90 days or condition it on a future event with proper follow-up filings.
Will my professional license transfer automatically?
No. Most licensing boards, including the Texas Medical Board and the State Bar of Texas, require notice and a new entity registration for licensed professionals after any conversion.
Related reading
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