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GuideFebruary 17, 202523 min read

Franchise Tax 101: Understanding Your Obligations in Texas

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Franchise Tax 101: Understanding Your Obligations in Texas

Table of Contents

Updated: December 22, 2025

If you run a business in Texas, you've probably heard of franchise tax. But what exactly is it, who needs to pay for it, and how do you stay compliant without pulling your hair out?

This comprehensive guide breaks it down in simple terms—covering everything from who must file, how to calculate your tax, step-by-step filing instructions, and how to avoid costly mistakes. Whether you're a new LLC or an established corporation, this guide will help you navigate Texas franchise tax with confidence.

What Is the Texas Franchise Tax?

Texas doesn't have a corporate income tax, but it does have a franchise tax—a fee businesses pay for the privilege of operating in Texas.

Unlike traditional income tax, franchise tax is based on your business's total revenue and taxable margin, not just profits.

This distinction matters because even businesses with zero net profit might still owe franchise tax if their total revenue exceeds the state's threshold.

Who Must Pay Texas Franchise Tax?

Entities Subject to Franchise Tax

The following business entities must file and potentially pay Texas franchise tax:

  • Corporations (including S corporations and professional corporations)
  • Limited Liability Companies (LLCs) (including single-member LLCs and series LLCs)
  • Partnerships (general, limited, and limited liability partnerships)
  • Banks and financial institutions
  • Professional associations
  • Business trusts
  • Joint ventures
  • Other legal entities doing business in Texas

Entities NOT Subject to Franchise Tax

The following are exempt from Texas franchise tax:

  • Sole proprietorships (except single-member LLCs, which ARE taxable)
  • General partnerships where all partners are natural persons (except LLPs)
  • Certain nonprofit organizations
  • Passive entities (meeting specific criteria)
  • Certain trusts and estates
  • New veteran-owned businesses (for the first 5 years, if qualified)

Important: Your federal tax treatment doesn't determine your Texas franchise tax obligation. Even if your LLC is disregarded for federal tax purposes, it's still a separate legal entity for Texas franchise tax.

How to Calculate Texas Franchise Tax?

Texas franchise tax calculation involves three key steps:

Step 1: Calculate Total Revenue

Total revenue includes:

  • Gross receipts from sales
  • Dividends and interest
  • Rents and royalties
  • Capital gains/losses
  • Other business income

Exclusions from revenue:

  • Bad debt expense
  • Foreign royalties and dividends
  • Certain flow-through funds
  • Subcontracting payments (for qualifying businesses)
  • Healthcare provider payments from Medicare/Medicaid
  • And other specific exclusions

Step 2: Choose Your Margin Calculation Method

Texas gives you four options to calculate your taxable margin. You can choose the method that results in the lowest tax liability:

  1. Total Revenue × 70%
  2. Total Revenue minus Cost of Goods Sold (COGS)
  3. Total Revenue minus Compensation
  4. Total Revenue minus $1 million

Important: Not all businesses qualify to use COGS. You must sell real or tangible personal property in the ordinary course of business.

Step 3: Apply the Tax Rate

Once your taxable margin is determined, it's taxed at one of two rates:

  • 0.75% for most businesses
  • 0.375% for qualifying wholesalers and retailers
  • 0.331% if using the EZ Computation (for businesses with $20M or less in revenue)

No Tax Due Threshold (2025)

If your business earns less than $2,470,000 in total revenue (as of 2025), you don't owe any tax, but you must still file a Public Information Report (Form 05-102) or Ownership Information Report (Form 05-167).

Calculation Examples

Example 1: Service Business

  • Total Revenue: $5,000,000
  • No COGS (service business)
  • Compensation: $2,500,000

Option 1: $5,000,000 × 70% = $3,500,000
Option 2: Not applicable (no COGS)
Option 3: $5,000,000 - $2,500,000 = $2,500,000 ← Lowest
Option 4: $5,000,000 - $1,000,000 = $4,000,000

Best margin: $2,500,000
Tax due: $2,500,000 × 0.0075 = $18,750

Example 2: Retail Business

  • Total Revenue: $8,000,000
  • COGS: $5,500,000
  • Qualifies for 0.375% rate

Option 1: $8,000,000 × 70% = $5,600,000
Option 2: $8,000,000 - $5,500,000 = $2,500,000 ← Lowest
Option 3: $8,000,000 - $3,000,000 = $5,000,000
Option 4: $8,000,000 - $1,000,000 = $7,000,000

Best margin: $2,500,000
Tax due: $2,500,000 × 0.00375 = $9,375

Example 3: Small Business (Under Threshold)

  • Total Revenue: $2,200,000

Result: No tax due, but must file Public Information Report.

Important Update:

The No Tax Due Report (Form 05-163) has been eliminated. Businesses under the revenue threshold must now submit their Franchise Tax Report online through Webfile on the Texas Comptroller’s website.

When and How to File Your Texas Franchise Tax Report?

Key Filing Dates for 2025

  • Annual Report Due Date: May 15, 2025
  • Extension Deadline (Non-EFT): November 17, 2025
  • Extension Deadline (EFT payors): August 15, 2025 (first extension), November 17, 2025 (second extension)
  • Final Report Due Date: 60 days after ceasing business in Texas

Who Must File?

All taxable entities in Texas must file, even if:

  • No tax is due
  • Revenue is below the $2,470,000 threshold
  • The business had zero activity

Step-by-Step Filing Instructions

Step 1: Determine Which Forms You Need

If your annualized total revenue is $2,470,000 or less:

  • File Public Information Report (Form 05-102) OR
  • Ownership Information Report (Form 05-167)
  • No franchise tax report required (unless you choose to file one)

If your annualized total revenue is between $2,470,001 and $20,000,000:

  • You can choose between:
    • EZ Computation Report (Form 05-169) — simpler, but no deductions/credits allowed
    • Long Form Report (Forms 05-158-A and 05-158-B) — more complex, allows deductions/credits
  • Plus Public Information Report (Form 05-102) OR Ownership Information Report (Form 05-167)

If your annualized total revenue exceeds $20,000,000:

  • Must file Long Form Report (Forms 05-158-A and 05-158-B)
  • Plus Public Information Report (Form 05-102) OR Ownership Information Report (Form 05-167)

Step 2: Gather Required Information

You'll need:

  • Texas Taxpayer Number (11-digit number assigned by the Comptroller)
  • Webfile Number (6-digit number, call 800-442-3453 if you don't have it)
  • Federal tax return for the accounting period
  • Revenue and expense records
  • NAICS code for your business
  • SIC code (if claiming wholesaler/retailer rate)

Step 3: File Online via Webfile (Recommended)

  1. Go to comptroller.texas.gov/taxes/file-pay
  2. Click "Webfile" and select "Franchise Tax"
  3. Enter your Texas Taxpayer Number and Webfile Number
  4. Follow the step-by-step prompts
  5. The system will help with calculations and catch errors
  6. Submit electronically

Benefits of Webfile:

  • Available 24/7
  • Built-in error checking
  • Automatic calculations
  • Immediate confirmation
  • Faster processing

Step 4: Pay Your Tax (If Due)

Payment Options:

Online (Recommended):

  • Credit card
  • Electronic check (Web EFT)
  • TEXNET (for businesses required to use EFT)

By Mail:

  • Check or money order payable to "Texas Comptroller"
  • Include Payment Form (Form 05-170)
  • Write your Texas Taxpayer Number and report year on the check

Electronic Payment Requirement: If your franchise tax liability exceeds $500, you may be required to pay electronically.

If you paid $10,000 or more in franchise tax during the previous state fiscal year (Sept 1 - Aug 31), you must pay electronically in the subsequent calendar year.

Step 5: Keep Records

Maintain copies of:

  • Filed reports
  • Payment confirmations
  • Supporting documentation
  • Federal tax returns

Retention period: At least 4 years

Missed Your Texas Franchise Tax Deadline? Here's What Happens Next

Failing to file your Franchise Tax Report on time can result in serious penalties, including:

Late Filing Penalties

  • $50 penalty — Assessed immediately when a report is filed late, regardless of whether tax is due

Late Payment Penalties

  • 5% penalty — If tax is not paid by the due date
  • Additional 5% penalty — If tax remains unpaid 30 days after the due date
  • Total: Up to 10% in late payment penalties

Interest Charges

  • Interest begins accruing 61 days after the due date
  • Rate: Prime rate + 1% (as published in The Wall Street Journal on January 1st)
  • For 2025, the interest rate is approximately 8.5%

Interest Calculation Example: If you owe $10,000 in taxes for 150 days at 8.5%: $10,000 × 0.085 × (150/365) = $349.32 in interest

Forfeiture of Right to Transact Business

If you don't file all required reports and/or don't pay tax, penalty, or interest within 45 days of receiving a "Notice of Intent to Forfeit," your business may:

  • Lose the right to transact business in Texas
  • Lose the right to sue or defend in Texas courts
  • Officers and directors become personally liable for debts created after the due date

Entities that fail to file or pay within 120 days of forfeiture may have their registration forfeited.

How to Request an Extension

If you can't file by May 15, you can request an extension:

For Non-EFT Payors:

  • Extension deadline: November 17, 2025
  • Must pay at least 90% of estimated tax OR 100% of prior year's tax by May 15
  • File Extension Request (Form 05-164) by May 15

For EFT Payors:

  • First extension: August 15, 2025 (pay 90% or 100% of prior year by May 15)
  • Second extension: November 17, 2025 (pay remaining balance by August 15)
  • Submit payment via TEXNET or Webfile

Zero-Money Extensions: If you were below the no tax due threshold last year, you can file a zero-money extension request.

File on time to avoid penalties. Waiting until the last minute often leads to errors, delays, and unnecessary fees.

Texas Franchise Tax Payment Options: Which One Is Best for You?

Businesses can pay their franchise tax using one of the following methods:

  • Online Payment: Recommended for all businesses. Payments can be made through the Texas Comptroller’s Webfile system.

  • By Mail: Businesses may also mail a check or money order along with their Franchise Tax Report.

  • Electronic Payment Requirement: If your total franchise tax liability exceeds $500, you may be required to pay electronically.

Even if you qualify for No Tax Due, you still must file a report through **Webfile **— a $0 tax liability does not mean no paperwork.

Understanding Franchise Tax Forms

Form 05-102: Public Information Report (PIR)

Who files: Corporations, LLCs, limited partnerships, professional associations, and financial institutions

What it includes:

  • Names and addresses of officers, directors, members, or general partners
  • Registered agent information
  • Business address

Due date: Same as franchise tax report (May 15)

Important: Even if you file your franchise tax report and pay all taxes, failure to file the PIR can result in forfeiture.

Form 05-167: Ownership Information Report (OIR)

Who files: Entities that are NOT corporations, LLCs, limited partnerships, professional associations, or financial institutions (e.g., general partnerships, business trusts)

What it includes:

  • Names of general partners
  • Owners with 10% or more interest
  • Registered agent information

Form 05-169: EZ Computation Report

Who qualifies: Businesses with $20 million or less in annualized total revenue

Benefits:

  • Simpler calculation (Total Revenue × 0.331%)
  • Fewer fields to complete
  • Faster processing

Limitations:

  • Cannot claim any tax credits
  • Cannot use margin deductions (COGS, compensation, etc.)

Forms 05-158-A and 05-158-B: Long Form Report

Who files: Businesses with over $20 million in revenue, or those choosing to claim deductions/credits

Benefits:

  • Can choose best margin calculation method
  • Can claim tax credits
  • More flexibility

Complexity: Requires more detailed information and calculations

Form 05-170: Payment Form

When to use: When paying by check or money order

What to include:

  • Total tax due
  • Prior payments (extension payments)
  • Penalty and interest (if applicable)

Common Mistakes to Avoid

1. Forgetting to File When No Tax Is Due

Mistake: Assuming that if you owe no tax, you don't need to file anything.

Reality: Even if your revenue is below $2,470,000, you must still file a Public Information Report or Ownership Information Report.

Consequence: $50 late filing penalty + potential forfeiture

2. Using the Wrong Accounting Period

Mistake: Using the current calendar year instead of the correct accounting period.

Correct approach: Your 2025 report (due May 15, 2025) should be based on your last federal accounting period end date in 2024.

Example: If your fiscal year ends September 30, your 2025 franchise tax report covers October 1, 2023 through September 30, 2024.

3. Not Annualizing Revenue for Short Periods

Mistake: Reporting actual revenue for a short period without annualizing.

When to annualize: If your accounting period is less than 12 months.

Formula: (Total Revenue ÷ Days in Period) × 365

Example:

  • Period: September 15 - December 31, 2024 (108 days)
  • Actual revenue: $800,000
  • Annualized: ($800,000 ÷ 108) × 365 = $2,703,704

This determines threshold eligibility, but you still report the actual $800,000 as total revenue.

4. Miscalculating Cost of Goods Sold (COGS)

Mistake: Including expenses that don't qualify as COGS.

What's NOT included in COGS:

  • Officers' compensation
  • Selling costs and advertising
  • Distribution and shipping costs
  • Interest expense
  • Income taxes

What IS included:

  • Direct labor costs
  • Materials and supplies
  • Manufacturing overhead
  • Depreciation on production equipment

5. Missing the Compensation Cap

Mistake: Deducting full compensation for high earners.

Reality: Compensation is capped at $450,000 per person per 12-month period.

Example: If you pay an executive $600,000, you can only deduct $450,000.

6. Choosing the Wrong Tax Rate

Mistake: Claiming the 0.375% wholesaler/retailer rate without qualifying.

Requirements to qualify:

  • More than 50% of revenue from wholesale/retail activities
  • Less than 50% from products you produce (except restaurants)
  • Not providing utilities (electricity, gas, telecommunications)

7. Not Keeping Adequate Records

Mistake: Discarding supporting documents after filing.

Best practice: Keep all franchise tax records for at least 4 years, including:

  • Filed reports and confirmations
  • Federal tax returns
  • Revenue and expense documentation
  • Payment receipts

8. Ignoring Combined Reporting Requirements

Mistake: Filing separately when you should file as a combined group.

When combined reporting is required:

  • Entities in an affiliated group (>50% common ownership)
  • Engaged in a unitary business
  • Sufficient interdependence and integration

Consequence: Incorrect tax calculation and potential penalties

9. Missing Electronic Payment Requirements

Mistake: Paying by check when required to pay electronically.

EFT requirement: If you paid $10,000+ in franchise tax during the previous state fiscal year (Sept 1 - Aug 31), you must pay electronically the following calendar year.

Penalty: Additional 5% penalty for not following EFT requirements

10. Filing the Wrong Forms After Threshold Changes

Mistake: Filing Form 05-163 (No Tax Due Report) for 2025.

Update: Form 05-163 has been eliminated. Instead, file:

  • Public Information Report (Form 05-102), OR
  • Ownership Information Report (Form 05-167)

Frequently Asked Questions (FAQ)

Do I need to file franchise tax if I just formed my LLC?

Yes. Your filing obligation begins the day your entity is formed or begins doing business in Texas. Your first annual report is due May 15 of the year following formation.

Example: LLC formed October 15, 2024 → First report due May 15, 2025

What if my business had no activity or revenue?

You still must file. Report zero revenue and file the required Public Information Report or Ownership Information Report.

Can I amend a franchise tax report after filing?

Yes. File an amended report with:

  • All pages of the corrected report
  • "AMENDED" written at the top
  • Cover letter explaining the changes
  • Supporting documentation

If requesting a refund, the claim must comply with Texas Tax Code Section 111.104.

Does Texas franchise tax apply to out-of-state businesses?

Yes, if you're "doing business" in Texas. This includes:

  • Having a physical presence in Texas
  • Employing people in Texas
  • Owning/leasing property in Texas
  • Making sales in Texas (beyond certain thresholds)

What is the minimum franchise tax?

There is no minimum tax. If your calculated tax is less than $1,000, you owe $0 (but must still file reports).

Exception: Tiered partnership elections—both upper and lower tier entities owe any calculated amount, even if under $1,000.

Can I get a refund if I overpaid?

Yes. File an amended report with a cover letter explaining the overpayment. The statute of limitations for refund claims is generally 4 years from the due date of the report.

What happens if I close my business?

You must file a final report within 60 days of ceasing business in Texas. If your annualized revenue is below $2,470,000, you're not required to file a final franchise tax report, but you'll need to verify this when requesting a certificate of account status.

To officially terminate, you must:

  1. File final franchise tax report (if required)
  2. Obtain certificate of account status from the Comptroller
  3. File termination documents with the Secretary of State by December 31 to avoid next year's tax

How do I check my franchise tax account status?

Visit the Franchise Account Status website to:

  • View filed reports
  • Check payment history
  • Verify good standing
  • Request certificate of account status

What if I disagree with a franchise tax assessment?

You have the right to:

  1. Request a redetermination — File within 60 days of the assessment
  2. Request a hearing — If redetermination is denied
  3. Appeal to district court — If hearing decision is unfavorable

Contact the Comptroller's office immediately if you receive an assessment you believe is incorrect.

Industry-Specific Considerations

For LLCs

Single-Member LLCs:

  • ARE subject to franchise tax (even though disregarded for federal tax)
  • Must file Public Information Report
  • Can deduct owner's compensation (net distributive income)

Multi-Member LLCs:

  • File as partnership or corporation (depending on federal election)
  • Each member's compensation capped at $450,000

For Partnerships

General Partnerships (all natural persons):

  • NOT subject to franchise tax
  • No filing requirement

Limited Partnerships and LLPs:

  • ARE subject to franchise tax
  • Must file Ownership Information Report
  • May qualify as passive entity (if 90%+ passive income)

For Corporations

C Corporations:

  • Subject to franchise tax
  • Must file Public Information Report
  • Officer compensation capped at $450,000 per person

S Corporations:

  • Subject to franchise tax (same as C corps for Texas purposes)
  • Shareholder distributions treated as compensation
  • Must file Public Information Report

For Professional Service Providers

Doctors, Lawyers, Accountants, Consultants:

  • Typically cannot use COGS deduction
  • Compensation deduction usually most beneficial
  • Professional associations must file

For Retail and Wholesale Businesses

Benefits:

  • Qualify for reduced 0.375% tax rate
  • Can use COGS deduction
  • Must meet specific criteria (see SIC code requirements)

Requirements:

  • More than 50% revenue from retail/wholesale
  • Less than 50% from self-produced goods (except restaurants)
  • Cannot provide utilities

For Manufacturing and Production

COGS Considerations:

  • Can include direct labor, materials, and overhead
  • Depreciation on production equipment included
  • Must track costs carefully

Section 179 Deduction:

  • Can include in COGS for Texas purposes
  • Different treatment than federal

For Real Estate Businesses

Rental Property Owners:

  • Rental income included in total revenue
  • May qualify as passive entity
  • Depreciation can be included in COGS (if selling property)

Real Estate Investment Trusts (REITs):

  • May qualify for exemption if meeting specific criteria
  • Must file to affirm qualification

For Technology and Software Companies

Software Sales:

  • Treated as tangible personal property for COGS purposes
  • Development costs may qualify as COGS
  • Licensing revenue included in total revenue

For Healthcare Providers

Special Exclusions:

  • 100% of Medicare/Medicaid revenues (including copays, deductibles)
  • CHIP and TRICARE revenues
  • Workers' compensation claims
  • Actual costs for uncompensated care

Healthcare Institutions:

  • Can exclude only 50% of the above (hospitals, nursing homes, etc.)

Texas Tax Compliance Checklist

Annual Requirements

✅ Texas Franchise Tax — Due May 15 annually

  • File franchise tax report (if revenue > $2,470,000)
  • File Public Information Report or Ownership Information Report
  • Pay any tax due

✅ Sales Tax — If selling taxable goods/services

✅ Federal Tax Returns

  • C Corp: Form 1120
  • S Corp: Form 1120S
  • Partnership: Form 1065
  • LLC: Varies by election

✅ Annual Report with Secretary of State

  • Different from franchise tax report
  • Required for corporations and LLCs
  • Verifies current information

Local Requirements

✅ Business Licenses and Permits

✅ Property Tax (if applicable)

  • Business personal property
  • Real estate
  • Due January 31

Employment Taxes (if you have employees)

✅ Federal:

  • Payroll taxes (FICA)
  • Federal unemployment (FUTA)
  • Income tax withholding

✅ Texas:

  • Unemployment tax (SUTA)
  • No state income tax withholding

2025 Franchise Tax Updates and Changes

What's New for 2025

No Tax Due Threshold: Remains at $2,470,000 (unchanged from 2024)

Tax Rates: No changes

  • 0.75% for most businesses
  • 0.375% for wholesalers/retailers
  • 0.331% for EZ computation

Form Changes:

  • Form 05-163 (No Tax Due Report) permanently eliminated
  • All entities below threshold must file PIR or OIR instead

Electronic Filing:

  • Webfile continues to be the recommended method
  • Available 24/7 with built-in error checking

Important Reminders for 2025

Veteran-Owned Businesses:

  • New qualifying veteran-owned businesses formed between Jan 1, 2022 and Dec 31, 2025 may be exempt for first 5 years
  • Must be 100% owned by honorably discharged veterans
  • Requires verification from Texas Veterans Commission

Combined Groups:

  • Must include all members even if individual members are below threshold
  • Reporting entity must file on behalf of group
  • Each member must file PIR or OIR if organized in Texas or has nexus

How Jupid Can Help

Franchise tax compliance can be complicated, but Jupid simplifies the process. We’re building an AI-powered accountant to simplify LLC formation, bookkeeping, and tax compliance through natural conversations.

File your Franchise Tax Report accurately and on time with Jupid.

Key Takeaways

✅ Texas franchise tax is based on revenue and margin, not profit — Even unprofitable businesses may owe tax

✅ The no tax due threshold for 2025 is $2,470,000 — But you still must file reports

✅ Due date is May 15 annually — Extensions available with proper payment

✅ Choose the best margin calculation method — Four options available; pick the lowest

✅ File electronically via Webfile — Faster, easier, with built-in error checking

✅ Penalties are steep — $50 late filing + 5-10% late payment + interest + potential forfeiture

✅ Keep records for 4 years — Including all reports, payments, and supporting documents

✅ Different entity types have different requirements — LLCs, partnerships, and corporations all treated differently

Next Steps: Your Franchise Tax Action Plan

Before May 15, 2025

  • Gather your federal tax return for the accounting period
  • Collect revenue and expense records
  • Determine your NAICS and SIC codes
  • Obtain your Texas Taxpayer Number and Webfile Number
  • Calculate your total revenue and determine if you're above/below threshold
  • Choose your margin calculation method (if applicable)
  • File your franchise tax report and PIR/OIR via Webfile
  • Pay any tax due electronically
  • Save confirmation and payment receipts

Throughout the Year

  • Maintain accurate financial records
  • Track revenue monthly to project next year's obligation
  • Update business information with Secretary of State if changes occur
  • Monitor for any franchise tax law changes
  • Consider working with a tax professional for complex situations

If You're Starting a New Business

  • Understand your filing obligation begins immediately upon formation
  • Register with the Texas Comptroller
  • Obtain your Texas Taxpayer Number
  • Mark May 15 on your calendar for next year
  • Set up accounting systems to track franchise tax components
  • Consider veteran-owned business exemption if applicable

Additional Resources

Official Texas Comptroller Resources

Contact Information

Texas Comptroller of Public Accounts

  • Phone: 800-442-3453 (toll-free)
  • Local: 512-463-4600
  • Email: tax.help@cpa.texas.gov
  • Mailing Address: P.O. Box 149348, Austin, TX 78714-9348

Webfile Number Retrieval:

  • Call 800-442-3453
  • Automated system requires taxpayer number and identifying information

Helpful Tools

Final Thoughts

Understanding the Texas franchise tax is essential for keeping your business compliant and avoiding costly penalties. While the system may seem complex at first, breaking it down into steps makes it manageable:

  1. Determine if you must file (most Texas entities do)
  2. Calculate your total revenue and check the threshold
  3. Choose the best margin calculation method
  4. File by May 15 using Webfile
  5. Pay any tax due electronically
  6. Keep records for at least 4 years

Whether you owe taxes or just need to file reports, staying ahead of your obligations will save you time, money, and stress. The penalties for non-compliance are significant, but the filing process itself is straightforward when you understand the requirements.

Remember: Even if you owe no tax, you still must file the required reports. Failure to file can result in forfeiture of your right to transact business in Texas and personal liability for officers and directors.

How Jupid Can Help

Franchise tax compliance can be complicated, but Jupid simplifies the process. We're building an AI-powered accountant to simplify LLC formation, bookkeeping, and tax compliance through natural conversations.

Jupid helps you:

  • Track revenue throughout the year
  • Calculate franchise tax obligations
  • Prepare accurate reports
  • Meet filing deadlines
  • Maintain compliance

File your Franchise Tax Report accurately and on time with Jupid. Focus on growing your business while we handle the tax complexity.

Get Started with Jupid →

Disclaimer: This guide provides general information about Texas franchise tax and should not be considered legal or tax advice. Tax laws change frequently, and every business situation is unique. Consult with a qualified tax professional or attorney for advice specific to your circumstances.

References and Sources

  1. Texas Comptroller of Public Accounts – Franchise Tax Overview: comptroller.texas.gov/taxes/franchise/

  2. Texas Tax Code Chapter 171 – Franchise Tax: statutes.capitol.texas.gov

  3. Texas Comptroller – 2025 Franchise Tax Report Information and Instructions (Form 05-914): comptroller.texas.gov/forms/05-914.pdf

  4. Texas Comptroller – Franchise Tax Filing: comptroller.texas.gov/taxes/franchise/filing.php

  5. Texas Comptroller – Penalties for Past Due Taxes: comptroller.texas.gov/taxes/file-pay/penalties.php

  6. Texas Comptroller – Interest Owed and Earned: comptroller.texas.gov/taxes/file-pay/interest.php

  7. Texas Secretary of State – Business Organizations: sos.state.tx.us/corp/

  8. Texas Comptroller – Sales Tax Information: comptroller.texas.gov/taxes/sales/

  9. Texas Comptroller – No Tax Due Reporting Updates: comptroller.texas.gov/taxes/franchise/ntd-rpt-updates-2024.php

  10. Texas Veterans Commission – Veteran-Owned Business Resources: tvc.texas.gov/entrepreneurs

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