Texas LLC Annual Requirements: Franchise Tax, Reports & Compliance
Table of Contents
Introduction
Forming your Texas LLC is just the first step. Once your business is up and running, you have ongoing annual requirements to maintain good standing with the state. Missing these requirements can result in penalties, loss of good standing, and even administrative dissolution.
In this guide, we'll explain every annual requirement for Texas LLCs, when they're due, and how to stay compliant.
Texas Franchise Tax
What Is the Franchise Tax?
Texas imposes a franchise tax on most business entities, including LLCs. Despite the name, this is not a tax on franchises—it's a privilege tax for the right to do business in Texas.
Who Must File?
All Texas LLCs must file a franchise tax report annually, even if no tax is owed. However, many small businesses qualify for the no-tax-due threshold.
The No-Tax-Due Threshold
If your LLC's annualized total revenue is below $1,230,000 (as of 2024), you may owe no franchise tax. But you still must file the report to avoid penalties.
Filing Deadline
The franchise tax report is due May 15th of each year. You can file through the Texas Comptroller's online system.
What You Need to File
- Your LLC's federal Employer Identification Number (EIN)
- Total revenue for the accounting period
- Information about members and ownership percentages
Important: Even if you owe no tax, failing to file the franchise tax report can result in forfeiture of your LLC's right to do business in Texas.
Public Information Report (PIR)
What Is the PIR?
The Public Information Report is an annual filing that updates the state on your LLC's key information, including:
- Names and addresses of members and managers
- Registered agent information
- Principal office address
- Nature of the business
When Is It Due?
The PIR is due at the same time as your franchise tax report—May 15th each year. In many cases, you can file both together through the Texas Comptroller's system.
What Happens If You Don't File?
Failure to file the PIR can result in:
- Loss of good standing
- Penalties and interest
- Administrative forfeiture of your LLC
Registered Agent Maintenance
Maintaining Your Registered Agent
Your LLC must maintain a registered agent at all times. If your registered agent changes—because they moved, went out of business, or you switched to a new service—you must file a Statement of Change with the Texas Secretary of State.
Registered Agent Requirements
Your registered agent must:
- Have a physical street address in Texas
- Be available during standard business hours
- Consent to the appointment
Learn more about our Texas Registered Agent Services.
Annual Compliance Calendar for Texas LLCs
Here's a summary of your annual requirements:
January–April
- Gather financial records from the previous year
- Prepare franchise tax information
- Verify registered agent information is current
May
- May 15th: File franchise tax report and Public Information Report
- Pay any franchise tax owed (if above the no-tax-due threshold)
June–December
- Maintain accurate financial records
- Review your operating agreement if membership changes
- Ensure registered agent information is current
- File any amendments if business information changes
Additional Requirements to Consider
Federal Tax Obligations
In addition to Texas state requirements, your LLC has federal tax obligations:
- Income tax: LLCs with multiple members file Form 1065 (partnership return). Single-member LLCs report on Schedule C of the owner's personal return.
- Self-employment tax: Members pay self-employment tax on their share of profits.
- Estimated taxes: If you expect to owe more than $1,000 in taxes, you may need to make quarterly estimated tax payments.
Business Licenses and Permits
Depending on your industry and location, you may need additional licenses or permits:
- State licenses: Certain professions (e.g., contractors, food service) require state licensing
- Local permits: Cities and counties may require business permits
- Sales tax permit: If you sell taxable goods or services, you need a Texas sales tax permit
Keeping Your LLC in Good Standing
To maintain good standing with the state:
- File all required reports on time
- Pay all taxes and fees
- Maintain a registered agent
- Keep your business information current
- Follow your operating agreement
Consequences of Non-Compliance
Failing to meet your annual requirements can result in:
- Loss of good standing: Your LLC loses its good standing status
- Administrative forfeiture: The state may forfeit your right to do business
- Penalties: Late filing penalties and interest charges
- Personal liability: If your LLC is forfeited, you may lose personal asset protection
- Inability to sue: You cannot bring lawsuits in Texas courts if your LLC is not in good standing
- Reinstatement costs: Reinstating a forfeited LLC requires additional fees and paperwork
Warning: If your LLC is administratively forfeited, you lose the personal asset protection that the LLC provides. Your personal assets could be at risk.
How to Stay on Track
Use a Compliance Calendar
Track all your deadlines in one place. Our LLC formation package includes a compliance calendar setup to help you stay on top of your requirements.
Work with Professionals
A registered agent service that provides compliance reminders can help ensure you never miss a deadline. Our service includes annual reminders for franchise tax and PIR filings.
Keep Good Records
Maintain accurate financial records throughout the year so you're prepared when filing deadlines arrive. Consider using monthly bookkeeping services to stay organized.
Review Annually
Each year, review your LLC's structure, ownership, and compliance status. Make any necessary amendments to your Certificate of Formation or operating agreement.
Key Takeaways
- Texas LLCs must file an annual franchise tax report (due May 15th)
- The Public Information Report is due at the same time as the franchise tax report
- Many small businesses owe no franchise tax but must still file
- Your LLC must maintain a registered agent at all times
- Non-compliance can result in loss of good standing, penalties, and administrative forfeiture
- A compliance calendar and professional registered agent help you stay on track
Need Professional Help?
Don't risk losing your LLC's good standing. Hire a professional registered agent who provides compliance reminders and ensures you never miss a deadline. Our service is $149 per year and includes annual filing reminders.
Learn more about Texas LLC Formation and how to start an LLC in Texas if you haven't formed your business yet.
