How to Start a Real Estate Business in Texas: TREC Salesperson and Broker Licenses

If you want to help people buy, sell, or lease property in Texas for pay, you need a license from the Texas Real Estate Commission (TREC). Texas does not issue a general state business license, so for this business the TREC license is the credential that matters. Counties license nothing here either, except the assumed name filing that a sole proprietor makes with the county clerk.

The path has two license levels. A sales agent is the entry license. A broker is the advanced license, and it is the level you need to open a brokerage. TREC licenses sales agents and brokers under Occupations Code chapter 1101, and its rules in 22 TAC 535.55 and 535.56 set the course, experience and application details. This guide walks through each path in order, then covers the business side: forming an entity, the state filings that follow, and the mistakes that cost people time.

Informational notice: This article is general information, not legal or tax advice. TREC's statutes, rules and fee schedule control, and they change. For a complex business structure or a tax question, talk to a qualified attorney or certified public accountant (CPA).

What You Need Before You Start

Gather these items before you enroll in any course. Missing paperwork is a common reason applications stall, so build a folder on day one and add to it as you go.

• A decision on which license you are pursuing: sales agent or broker.
• Course certificates for the 180 hours of sales agent qualifying courses: 60 hours of principles of real estate, and 30 hours each in agency law, contracts, promulgated contract forms, and real estate finance.
• For broker applicants: records of 270 hours of qualifying courses, including a 30-hour brokerage course, plus either 630 hours of related education or a bachelor's degree with an official transcript.
• For broker applicants: proof of 4 years of active licensed experience in the past 5 years, and at least 360 points of qualifying experience.
• Your passing exam result and fingerprints for the background check.
• A sponsoring broker, if you are a sales agent.
• TREC's current fee schedule. Its application fees changed in recent schedules, so do not rely on older articles or forum posts for dollar amounts.
• If you plan to form an LLC for your brokerage: the Certificate of Formation (Form 205) with its $300 filing fee, and a Texas registered agent.
• Budget for errors and omissions (E&O) insurance if the brokerage you join requires it.

The Sales Agent Path, Step by Step

Most new license holders start here. The sales agent path has six stages, and the last one happens after you are already licensed.

Step 1: Complete 180 hours of qualifying courses

The sales agent license requires 180 hours of qualifying courses. The required breakdown is 60 hours of principles of real estate and 30 hours each in agency law, contracts, promulgated contract forms, and real estate finance. Before you pay for any course, confirm that it counts toward the TREC requirement and that the provider will issue a certificate you can submit. Keep every certificate with the course name, hours, and completion date. Courses that cover the same topic under different titles can still leave you short on the required subject breakdown, so check the hours by subject, not just the total.

Step 2: Pass the state exam

After your courses are complete, you take the license exam. Confirm your eligibility with TREC before you book a date, and keep the official result notice once you pass. Study with practice questions that cover real estate law and the contract topics from your courses. Your exam result is one of the items you will attach to your application.

Step 3: Complete fingerprints

Fingerprints are part of the application because TREC runs a background check. Follow TREC's current instructions for where and how to be fingerprinted, and do this early so it does not hold up your application. Keep the record of your fingerprint submission with your other documents.

Step 4: Line up a sponsoring broker

A sales agent cannot act without a sponsoring broker. This is the most important point in the sales agent path, and it is the step most people underestimate. Interview brokers before you apply. Ask about training, how they handle E&O coverage, what fees they charge agents, and how supervision works day to day. Get the sponsorship arrangement in writing before you submit your application.

Step 5: Submit the application and pay TREC fees

Submit your application with your course certificates, exam result, fingerprint record, and sponsor information. TREC's application fees changed in recent fee schedules, so check the current schedule on the TREC website before you send any money. This article does not list a current TREC fee amount, so treat any figure you find elsewhere as unverified until you match it to TREC's schedule.

Step 6: Finish 90 more classroom hours before your first license term ends

Once licensed as a sales agent, you must complete 90 more classroom hours before your first license term ends. That total includes a 30-hour brokerage course. Find your term end date on your license record and put the deadline on your calendar the day your license issues. Confirm the exact date with TREC if you are unsure how your term is counted.

The Broker Path

A broker license is the next level, and its requirements are heavier. The experience requirement alone means most people need several years of active licensed work before they can apply. The steps below follow the requirements in 22 TAC 535.56.

Step 1: Document 4 years of active licensed experience

You need 4 years of active licensed experience within the past 5 years. Keep a record of your license history and the dates you were active. Confirm with TREC how any inactive periods are treated before you assume they count toward the 4 years.

Step 2: Earn at least 360 points of qualifying experience

Broker applicants also need at least 360 points of qualifying experience. Because this is a points requirement, do not assume a set number of transactions equals a set number of points. Track your activity as you go, and confirm how each type of activity is scored with TREC before you rely on it.

Step 3: Complete 270 hours of qualifying courses

The broker course requirement is 270 hours of qualifying courses, including a 30-hour brokerage course. You must also meet the education requirement with either 630 hours of related education or a bachelor's degree. Choose the route that fits your background and document it carefully. If you use a bachelor's degree, keep an official transcript on file and confirm how TREC wants it submitted.

Step 4: Complete the remaining application steps

The broker application follows the same general logic as the sales agent path: documented education, documented experience, and a background check. Confirm the exam and fingerprint steps for broker applicants on TREC's current application materials, since that is the source of truth for what you must submit.

Setting Up Your Business Structure

A broker license lets you run your own brokerage, which is a separate decision from the license itself. A sales agent cannot open a brokerage on their own, because a sales agent cannot act without a sponsoring broker.

A sole proprietor operates under the owner's own name and needs no state formation filing. If you operate under any other name, you file an assumed name certificate. A business entity, such as an LLC, must designate a licensed broker, so the entity's real estate activity is tied to a broker license. The steps below describe the LLC route, which is the most common choice for a brokerage.

Forming an LLC for your brokerage

1. Check the name. The name must be distinguishable in the Texas Secretary of State records from any existing filing, and it must include an organizational designation such as Limited Liability Company, Limited Company, LLC, L.L.C., LC or L.C. It may not imply a purpose the LLC is not authorized to pursue, and it may not falsely suggest an affiliation with a governmental entity. Search the business records at https://www.sos.state.tx.us/corp/searches.shtml, and call (512) 463-5555 for preliminary availability.
2. Reserve the name if you need time. A name reservation costs $40 and lasts 120 days.
3. File the Certificate of Formation (Form 205). The filing fee is $300. The Secretary of State says electronic filing through SOSDirect at https://direct.sos.state.tx.us/acct/acct-login.asp gives the fastest processing, and it does not publish a guaranteed standard turnaround. Paid expedite tiers are the only guaranteed timing: Standard Expedite is $50 per document and is typically processed in two to three business days, Next Day Expedite is $500 per document for filings received by 12:00 p.m., and Same Day Expedite is $750 per document for filings received by 12:00 p.m. Expedite fees are in addition to the filing fee.
4. Appoint a registered agent. Every Texas LLC must keep a registered agent and a registered office in Texas. The registered office must be a physical street address where the agent can be served in person during business hours. A post office box, mail forwarding service, or answering service alone is not enough, and the company cannot serve as its own registered agent. A change of agent or office costs $15. A resignation of registered agent has no fee.
5. Designate your licensed broker. The entity must designate a licensed broker, and that designation is part of how TREC treats the brokerage.
6. File an assumed name certificate if needed. If the brokerage will operate under a name other than the LLC's legal name, file an assumed name certificate with the Secretary of State on Form 503 for $25. Sole proprietors file instead with the county clerk in each county where they conduct business, and county fees vary by county.

Recurring state filings after formation

• Public Information Report: Due May 15 each year to the Texas Comptroller of Public Accounts, not to the Secretary of State. There is no annual report fee with the Secretary of State.
• Franchise tax: Texas levies no state income tax and no corporate income tax. Instead, the franchise tax applies. For the 2026 and 2027 report years, entities with total revenue at or below $2,650,000 owe no tax, but they must still file the Public Information Report. Above that threshold, the rate is 0.375 percent for retail and wholesale businesses and 0.75 percent for other entities. A brokerage is a service business, so it generally falls in the 0.75 percent group. Confirm that with the Comptroller or a CPA. Comptroller information is at https://comptroller.texas.gov/taxes/.
• Publication: Texas has no publication requirement for a new LLC.

Common Mistakes to Avoid

• Acting as a sales agent before a sponsoring broker is in place. A sales agent cannot act without one.
• Missing the 90 classroom hours. Calendar the deadline the day your license issues.
• Counting broker experience without records. Keep documentation of your active licensed time and your qualifying points.
• Looking for a county or state general business license. Texas does not issue one, and counties license nothing except the assumed name filing by sole proprietors. Your TREC license is the license that applies to this business.
• Using a post office box as the registered office. The registered office must be a physical Texas street address.
• Relying on old fee amounts. TREC's application fees changed in recent schedules. Check the current schedule before you pay.
• Skipping the E&O question. E&O coverage is not a statewide requirement for individual license holders, but many brokerages require it. Ask your broker before you sign anything.

What to Expect After You Are Licensed

Results depend on your background, your local market, your sponsoring or supervising broker, and how much time you put into the work, so no outcome is guaranteed. A licensed sales agent may be able to begin working once a sponsoring broker is in place, and the 90 classroom hours still have to be completed on schedule. A broker who forms an entity will take on recurring state filings, including the Public Information Report, and may owe franchise tax depending on revenue. Some new agents report that their first year goes mostly to building a network and learning transaction paperwork, though experiences vary widely.

Tradeoffs and Costs to Weigh

The sales agent route is the lower-cost entry point, but it ties your activity to a sponsoring broker. The broker route gives you more control, including the option to open your own brokerage, but it requires several years of licensed experience and more coursework. E&O coverage, brokerage fees, and training costs vary by brokerage, so compare them side by side before you choose. For any decision about entity structure, liability, or taxes, talk to a qualified attorney or CPA.

Next Steps

1. Choose your path: sales agent or broker.
2. Enroll in qualifying courses and save every certificate.
3. Check TREC's current fee schedule and application materials.
4. Interview sponsoring brokers and get the arrangement in writing.
5. If you are forming an LLC, check name availability, file the Certificate of Formation, and appoint a Texas registered agent.

Disclaimer: This article is informational only and is not legal or tax advice. Licensing rules, fees, and filing requirements change. Confirm every requirement with the Texas Real Estate Commission, the Texas Secretary of State, or the Texas Comptroller of Public Accounts before you act, and consult a qualified attorney or CPA for complex situations.