TEXAS FRANCHISE TAX REPORT FILING INSTRUCTIONS

What is the cost to file the Texas Franchise Tax Report?

Texas Franchise Tax rates are:

  • TX Corps, PCs, LLCs, PLLCs and LLPs-domestic and foreign: Pay 1% of gross receipts over $1,000,000.
  • 0.5% for wholesalers and retailers.
  • 0.575% for businesses with $10 million or less in annual revenue and filing E-Z Computation form.

Texas Periodic Report:

  • TX Nonprofit-domestic and foreign: $5
  • TX LPs-domestic and foreign: $50
  • TX Law Enforcement Charity renewal with TX AG: $50

How to file your Texas Franchise Tax Report:

The Texas Secretary of State does not require corporations, LLCs and LLPs to file an annual report. Instead they submit an information report when they file and pay their annual franchise tax with the Texas Comptroller of Public Accounts. The report is not simple. It is a tax return and you will most likely need help from your accountant to decipher gross receipts, dividends, interest, losses etc., etc.

TX Corporations, PCs and TX LLCs and PLLCs have to file a Public Information Report with the Franchise Tax. TX LLPs must file an Ownership Information Report with the Franchise Tax Report. These forms can be downloaded from the Comptroller website or completed online with the WebFile system. See the links below.

TX Nonprofits and LPs-domestic and foreign: Submit the Periodic Report in duplicate by mail with the filing fee.

TX Charities: Mostly unregulated in Texas unless the charity solicits funds for the benefit of law enforcement or the military. In that case, they register and renew with the TX Attorney General.

When are Texas Franchise Tax Reports Due?

Your first franchise tax report is due on May 15 of the year after your first filing in Texas. For example if your entity was formed in 2012, the first annual report would be due May 15, 2013 and every May 15th after that.

Texas Nonprofits and Limited Partnerships will be requested to file a Periodic Report not more than once every four years. The due date will be printed on the request.

Does Texas have initial report requirements?

No. Your report is not due until the year after you start your business in Texas.

What are the penalty fees for a delinquent Texas Franchise Tax Report?

The TX Comptroller charges a $50 penalty when a report is filed late, plus a 5% penalty on the tax due. If you still have not filed within 30 days after the due date, an additional 5% penalty is added.

Texas Secretary of State charges a $1/month late fee for TX Nonprofits and $25/month late fee for TX LP Periodic Reports.

How do I get notified?

Texas Comptroller mails a notice to your business about six weeks before the report is due. This notice will have the WebFile ID number on it. You will need this number to file the franchise tax online.

The Texas Secretary of State will mail a periodic report request to the Texas registered agent of the nonprofit and limited partnership.

Who can file Texas Franchise Tax Reports?

An officer or director (corporations in Texas), manager or member (LLCs in Texas), partner (partnerships), or agent may sign.

Are original signatures needed?

No.

Resources:

Texas Comptroller of Public Accounts
Lyndon B Johnson State Office Building
111 East 17th Street
Austin, TX 78774
Phone: (512) 463-4600
Email: comptroller.help@cpa.state.tx.us

TX Secretary of State
Reports Unit
P.O. Box 12028
Austin, TX 78711-2028
Phone: (512) 475-2705

Tax forms: http://www.window.state.tx.us/taxinfo/taxforms/05-simple.html
WebFile: http://www.window.state.tx.us/taxinfo/franchise/webfile_franchise.html