In Texas, the primary annual filing requirement for most business entities, including LLCs, corporations, and partnerships (unless specifically exempt), is the Franchise Tax Report, which consists of two main components:
- Public Information Report (PIR) or Ownership Information Report (OIR): This report provides organizational information to the Texas Comptroller’s office, which is then forwarded to the Secretary of State.
- Franchise Tax Report (No Tax Due, EZ Computation, or Long Form): This report determines if your entity owes any franchise tax based on its revenue.
Why is it important to file? Filing these reports on time is crucial for maintaining your entity’s active status and good standing with the State of Texas. Failure to file can lead to severe consequences, including:
- Forfeiture of Right to Transact Business: Your entity can lose its legal right to conduct business in Texas, meaning it cannot sue or defend in a Texas court.
- Personal Liability: Officers, directors, partners, members, or owners may become personally liable for certain debts of the entity.
- Penalties and Interest: A $50 penalty is assessed on each report filed after the due date. Additional penalties (5% if paid 1-30 days late, 10% if paid over 30 days late) and interest are assessed if franchise tax is due and paid late.
- Loss of Name Protection: Your entity’s name may become available for others to use.
- Complex Reinstatement: Reinstatement involves filing all delinquent reports and paying all associated fees and penalties.
When is it due? For most entities, the Texas Franchise Tax Report (including the PIR or OIR) is due annually by May 15th. If May 15th falls on a weekend or holiday, the due date shifts to the next business day. Reports may be filed as early as January 1st.
Specific Requirements by Entity Type:
For Corporations (For-Profit) & Limited Liability Companies (LLCs) in Texas:
- Franchise Tax Report (Form 05-158, 05-163, or 05-169) & Public Information Report (PIR – Form 05-102): These entities are generally required to file both.
- No Tax Due Threshold: For reports originally due on or after January 1, 2024, if your annualized total revenue is less than or equal to $2,470,000, you are no longer required to file the Franchise Tax Report (the tax calculation part). However, you MUST still file the Public Information Report (PIR – Form 05-102) to avoid forfeiture.
- Tax Due: If your annualized total revenue exceeds the no-tax-due threshold, or if your computed tax is $1,000 or more, you must file the appropriate Franchise Tax Report (EZ Computation or Long Form) and pay any tax due, in addition to the PIR.
- Filing Fee: There is no filing fee for the PIR itself if filed on time. Franchise tax, if owed, will be calculated based on your margins.
For Partnerships (Limited Partnerships, Limited Liability Partnerships, etc.):
- Franchise Tax Report & Ownership Information Report (OIR – Form 05-167): Certain partnerships are subject to the Franchise Tax and must file an OIR instead of a PIR. The same no-tax-due thresholds apply. The OIR information is confidential.
- LLPs (Limited Liability Partnerships): In addition to the above, LLPs must also file a Renewal of Limited Liability Partnership Application for Registration (Form 308) annually by their registration anniversary date with the Texas Secretary of State. The fee is $200 per partner, with a maximum fee of $750.
For Non-Profit Corporations in Texas, please also note the following:
- Franchise Tax Report (including PIR): Certain non-profit organizations are exempt from franchise tax and are generally not required to file the Franchise Tax Report or PIR. However, this is not automatic and depends on their specific tax-exempt status (e.g., 501(c)(3)) and activities. It’s crucial to confirm your entity’s exemption status with the Texas Comptroller.
- Periodic Report of a Nonprofit Corporation (Form 802): The Texas Secretary of State may request a Periodic Report from non-profit corporations once every 4 years. This request will state the due date. The filing fee is $5.00. This is separate from the Comptroller’s Franchise Tax filings.
- Charitable Solicitation Registration (if applicable): Most charities or non-profit organizations are not required to register with the Texas Secretary of State for charitable solicitation unless they are certain public safety organizations, independent promoters, public safety publications, veterans organizations, or telephone solicitors. If your organization falls into one of these categories, annual registration/renewal may be required with the Texas Secretary of State and/or the Texas Attorney General, with varying forms, fees, and due dates.
- Federal IRS Form 990 Series: As a federally tax-exempt organization, your non-profit must file an annual information return with the IRS (Form 990, 990-EZ, 990-PF, or 990-N, depending on your gross receipts and assets). This is typically due by the 15th day of the 5th month after your fiscal year ends (e.g., May 15th for a December 31st fiscal year-end).
What information is required? The Public Information Report (PIR) and Ownership Information Report (OIR) typically require:
- Your entity’s legal name and Texas Taxpayer Number.
- Texas Secretary of State file number.
- Current mailing address.
- Principal office address (where records are maintained).
- Principal place of business address (where most day-to-day operations occur).
- The name and address of your Texas Registered Agent.
- Names, addresses, titles, and term expiration dates for officers, directors, managers, or members/general partners.
- Information on any parent companies or subsidiaries (10% or more ownership interest).
How can we assist you? We can assist you with the preparation and online filing of your Texas Franchise Tax Report (including the PIR/OIR) and any applicable non-profit renewals to ensure they are submitted accurately and on time. Our services for these filings include:
- [List specific services you offer, e.g., “Determining your filing requirements and tax due (if any),” “Gathering the necessary information,” “Accessing the Texas Comptroller’s Webfile system and completing the report,” “Submitting the filing and arranging payment,” “Confirming receipt with the Texas Comptroller.”]
What we need from you: To facilitate these filings, please FILL UP the Information sheet.
Please contact us at your earliest convenience to discuss your Texas compliance obligations. We can help ensure your entity remains in good standing and avoid any potential penalties.