Texas Annual Reporting

You did it. Your Texas LLC is officially up and running, ready to take on challenges, roll in the profits, and change the world.

There’s no doubt that this is an exciting time in your business journey. After starting your LLC, it’s easy to get carried away in all the excitement and expectations. After all, as a new business owner, you’ve got a lot on your plate.

But the state does too. They need to keep updated records on thousands of businesses so that they can effectively reach out with any important tax or legal communications down the road. How do they do it? With your cooperation, of course.

In Texas, an LLC’s annual report is commonly referred to as the Franchise Tax Public Information Report. Each LLC must submit this filing to the Texas Comptroller every year to keep their information current. Unsure how to go about it? Never even heard of it? No worries at all. That’s why we’re here. Keep reading for everything you need to know.

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What Is the Texas Franchise Tax Public Information Report? Why Is It Important?

Consider this filing the state’s yearly checkup on your LLC. It’s similar to a census in that its purpose is to collect the necessary contact and structural information about each Texas business.

Each state has its own annual reporting requirements, and some don’t even require them. But in most states, you’re required to submit one per year that includes your LLC name, principal office address, registered agent information, and member/manager names and addresses. Whether you run a domestic or foreign LLC, you should plan on submitting a Franchise Tax Public Information Report.

Don’t be intimidated, but it’s not something you want to take lightly. This is how the state updates your LLC’s record with the most recent information. They need to know how to reach you with important information about your business status, upcoming filings, taxes, and service of process.

For example, if you change your registered agent, or your current agent resigns, you’ll need to keep the state informed so they can update their contact information. Miss one of their communications and your LLC in Texas might end up falling out of good standing or, even worse, being administratively dissolved.

Moreover, keeping your information current will help other businesses and potential customers find you. If the Comptroller has the most updated data on record, anyone – including future partners and clients – can find your business by performing a name search.

How Much Does the Texas LLC Franchise Tax Cost?

If you’re putting together a budget for all your LLC’s costs – like formation costs, name reservation fees, and initial operating expenses – it’s important to include annual filings like this one, just so that there are no surprises.

Costs vary from state to state. Some are free while others can be several hundred dollars. How much you pay for the Texas Franchise Tax depends entirely on your LLC’s total annual revenue. If your business revenue falls under the “no tax due” threshold, it will not owe a tax. The current threshold is $1,180,000, so if your LLC doesn’t make that much in a year, you won’t be responsible for any payments. But businesses that bring in more than that will be subject to a 0.375% Franchise Tax on retail and wholesale goods and 0.75% on all other revenue.

Due Date and Frequency for a Franchise Tax Public Information Report in Texas

Your LLC will need to file its Franchise Tax Public Information Report once per year, but not on April 15th like the rest of your taxes. Instead, these filings are due on May 15th each year. If May 15th falls on a weekend or holiday, the due date will simply move to the next business day.

After you file a Certificate of Formation to form your LLC, you will need to file a Franchise Tax Public Information Report every year, even if you don’t owe a tax payment.

What Happens if You Don’t File?

You might be thinking, “that sounds like a pain. How bad could it be if I just fly under the radar?” The short answer: don’t try it. Failing to file your Franchise Tax Public Information Report can yield some serious consequences.

Reports filed after May 15th will automatically incur a $50 late fee, plus an additional 5% penalty if a tax is paid 1-30 days after the due date or a 10% penalty if paid more than 30 days late. Plus, the Comptroller can revoke your LLC’s authority to do business in the state.

Required Information

If it’s come time to file your Franchise Tax Public Information Report, you might be wondering what you’re in for. It’s a good idea to have your business and financial information ready beforehand, so you can cruise right through the filing. Most LLCs fall below the “no tax due” threshold and therefore need to file a No Tax Due form. Here’s what you’ll need to complete it:

  • Taxpayer number
  • Taxpayer name
  • LLC mailing address
  • NAICS code (you can find all NAICS codes here)
  • Accounting year begin and end dates
  • Total revenue

If your LLC earns more than $1,180,000 per year, you will instead need to compute your tax using a Franchise Tax EZ Computation Report or a Long Form. Either way, you’ll need to submit a Public Information Report, and here is the information it requires:

  • Taxpayer number and name
  • LLC mailing address
  • Principal office address
  • Name, title, and address for each member/manager
  • Any subsidiaries of which the LLC owns 10% or more
  • Any business that owns 10% or more of the LLC
  • Registered agent name and address

Because this is both a financial and informational filing, it requires a bit more data than other states’ annual reports. However, if you have all of it ready by the time you file, the forms shouldn’t take you long at all.

Filing Options

The Texas Comptroller provides both electronic and hard copy versions of these forms, so you can file online or by mail if your LLC owes a Franchise Tax. If it doesn’t, you’ll need to file online, as Texas only accepts No Tax Due Public Information Reports online.

Online Filing: You can complete the entire process through the Comptroller’s WebFile portal. If you don’t already have an account, you’ll need to create one. After you’ve logged in, select “Pay Franchise Tax” and enter your LLC’s taxpayer number (which you can find on your Welcome Letter from the Comptroller’s office). Choose the appropriate form and you’ll be directed through a series of pages where you can enter your information for both required forms.

Filing by Mail: Download and complete an EZ Computation Form to determine how much you owe, then file your Public Information Report. Then, mail both documents, along with any necessary tax payments, to:

Texas Comptroller of Public Accounts

P.O. Box 149348

Austin, TX 78714-9348

Does the State Send Reminders?

Reminders are always nice. They help you stay on top of your business requirements and ensure that you won’t fall out of good standing.

The Texas Comptroller won’t send out any reminders about your Franchise Tax Public Information Report due date, so you’ll be responsible for staying on top of it. Whether or not you need to make a Franchise Tax payment, this is an important filing, so we recommend setting up your own series of reminders, just so you don’t forget.

Conclusion

There you have it, everything you need to know about Texas’s reporting requirements. Follow this guide to a T and your LLC will be prepared to operate smoothly and in good standing long into the future.

And remember, if at any point it seems overwhelming, you’re not alone. A good LLC service like ZenBusiness (or LegalZoom) can be a valuable resource, taking care of all the little details, so you can focus on growing your business.

Frequently Asked Questions

About Filing the Texas LLC Franchise Tax Public Information Report

Should I use an annual report service, hire an attorney, or prepare and file my own reports?

This question largely comes down to personal preferences, but we do have some general insights. The DIY route can be quite a bit of work, as you’ll need to keep track of your due dates and complete the entire report on your own with no assistance. As for hiring an attorney, this can be prohibitively expensive for many businesses, as a lawyer can charge hundreds or even thousands of dollars to prepare and file your Franchise Tax Public Information Reports.

You can think of business services companies as a middle ground between these options. While most of these companies charge a fee to prepare and file your Franchise Tax Public Information Reports, that fee will be significantly less expensive than an attorney’s fee. At the same time, you still aren’t going it alone. Instead, you have an experienced professional guiding you through the entire process.

I’ve heard the most about LegalZoom. Are they the best annual report service?

LegalZoom is the most well-known of all business services companies, thanks to its long track record and extensive advertising campaigns. That said, all of that brand power comes at a cost, as LegalZoom’s pricing and features don’t always compare advantageously to its competitors. While we do appreciate LegalZoom’s annual report filing service, it isn’t our top choice.

When is my Franchise Tax Public Information Report due each year?

It doesn’t matter when you formed your LLC, as every LLC operating in Texas has the same May 15th deadline for filing its annual Franchise Tax Public Information Report.

Does Texas require LLCs to file initial reports?

In some states, LLCs are also required to file initial reports. These reports are typically quite similar to annual reports, with the difference being that an initial report either accompanies your formation documents or follows their filing within a couple of months.

In Texas, LLCs don’t need to file initial reports. Instead, this state gathers all of the information it needs for your LLC’s first year in business from your Certificate of Formation filing.

What if I need more time to complete my Franchise Tax Public Information Report?

If you’re running short on time, you’ll be happy to hear that Texas does offer extensions for Franchise Tax Public Information Reports. For more information, take a look at the filing extensions page on the Texas Comptroller’s website.

Where can I find more official information about Texas’ LLC annual reporting requirements?

Texas provides more helpful info online about its Franchise Tax Public Information Reports than every other state offers for its annual reports. The state’s “Information and Instructions” document includes in-depth info about just about every aspect of the reporting process. In total, it’s 30 pages of valuable tips and pointers.

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