Texas Franchise Tax: What Austin Businesses Need to Know

What the Texas Franchise Tax Covers

Texas imposes franchise tax on taxable entities formed in Texas or doing business in the state. Entity type, exemptions, revenue and the report year determine the actual obligations. This page is general information, not a determination of your entity’s liability. Start with the Texas Comptroller’s franchise-tax page and consult a qualified tax professional for your facts.

No Tax Due Does Not Always Mean No Information Filing

For report years 2024 and later, a taxable entity with annualized total revenue at or below the applicable no-tax-due threshold does not file the discontinued No Tax Due Report. It must still file the applicable Public Information Report (Form 05-102) or Ownership Information Report (Form 05-167). Check the Comptroller’s filing requirements and report-year instructions rather than reusing an old threshold or form.

The earlier instruction on this page to file a No Tax Due Report below the threshold was incorrect and has been withdrawn. Revenue thresholds and other limits are report-year specific; annualized revenue can differ from the amount received during a short accounting period.

Reports, Deadlines and Calculation

The Comptroller lists EZ Computation and Long Form reporting options for entities required to file a franchise-tax report. Eligibility, margin deductions, credits and any tax due depend on the applicable rules. Do not assume that a federal income-tax deduction is also an allowable franchise-tax deduction.

Annual reports are generally due May 15, with the next-business-day rule when that date falls on a weekend or holiday. Check the current due dates and extension instructions for the report year and account. A tax report, an information report and payment are distinct requirements. Verify each instead of relying on a generic first-year deadline or assuming an extension removes payment obligations.

Records to Prepare

Keep the entity’s Comptroller account information, reporting period, ownership/officer information, revenue records and supporting cost or compensation records organized. Reconcile the books and confirm who is responsible for filing, reviewing and paying before the deadline. Do not send bank credentials or tax documents through an unverified intake channel.

If You Receive a Notice

Review the notice against the entity’s actual account and follow the Comptroller’s current instructions. Below-threshold entities may need to resolve a missing information report rather than file a discontinued No Tax Due Report. Ask the Comptroller or a qualified adviser about penalties, reinstatement and disputed balances; this page does not calculate them.

Service Availability

Bookkeeping Austin TX is an informational publication and is not accepting clients or offering tax filings. See site availability.