Texas Franchise Tax + PIR: The 2026 Practical Guide

TLDR

Texas franchise tax reaches most Texas-domiciled and Texas-doing-business corporations, LLCs, partnerships, and similar entities, with statutory exceptions (certain partnerships and qualifying nonprofits among them). The 2026 no-tax-due threshold is $2,650,000 of annualized total revenue — up from $2,470,000 in 2024-2025.

Even if you owe no tax, you must still file your annual information report, the PIR or the OIR depending on entity type

or your entity can forfeit its right to transact business in Texas. PIR is due May 15 each year. The No Tax Due Report was eliminated for 2024+ reports, so an entity under the threshold now files just the information report: a PIR, or an OIR for entities that do not file a PIR.

In this guide, you’ll learn:

Recognize which entities are covered (corporations, LLCs, LPs, PAs, PLLCs) vs which aren’t (sole props, general partnerships, qualified nonprofits)
See the 2026 no-tax-due threshold ($2,650,000) and what changes when you cross it
Understand exactly what’s captured in the PIR (and why it’s a public record affecting privacy)
Know the May 15 deadline, the $50 late penalty, and how forfeiture is actually triggered (one delinquency plus a 45-day notice, not a year count)
Walk through the catch-up process for whichever status you are in: delinquent, or already forfeited

$2,650,000

No-tax-due threshold

2026 annualized revenue
May 15

Annual due date

Information report every year
$50

Late penalty

Per report filed late

Source: Texas Comptroller of Public Accounts, 2026 franchise tax reports.

#What’s covered

Texas franchise tax applies to:

Corporations (C-corps, S-corps)
LLCs (single-member and multi-member)
Limited Partnerships (LPs)
Professional Associations (PAs)
Professional Limited Liability Companies (PLLCs)
Financial institutions

What’s NOT covered:

Sole proprietorships (no separate entity)
General partnerships (under specific conditions)
Nonprofits qualifying under §501(c) with appropriate Texas filings
Out-of-state entities with no Texas nexus (no Texas operations, no Texas employees, no Texas-source income)

If you formed a Texas LLC or corporation, or your out-of-state entity registered to do business in Texas, you’re covered.

#The 2026 no-tax-due threshold

For 2026 franchise tax reports:

Entity revenue	Tax due	Information report (PIR or OIR)
≤ $2,650,000 annualized total revenue	None	Yes
> $2,650,000	Calculated per the franchise tax formula	Yes

The threshold increased from $2,470,000 in 2024-2025 to $2,650,000 in 2026. This means more small businesses fall below the no-tax-due line each year as the threshold grows.

For an entity below the threshold: zero tax owed, but the information report is still mandatory. Corporations, LLCs, and similar entities file the PIR; entities that do not file a PIR file the OIR.

For an entity above the threshold: the franchise tax is calculated per Texas Tax Code, typically 0.375% (retail/wholesale) or 0.75% (other) of taxable margin.

#What the PIR captures

The Public Information Report (Form 05-102) is a one-page disclosure of:

Entity name + Texas Comptroller File Number
Registered agent + address
Principal office address
Officers + directors (for corporations) OR managers + members (for LLCs/PLLCs) — names and addresses
Ownership information (who owns what percentage)
Signed by an officer / member / manager

The information is public — anyone can pull it via the Texas Comptroller’s website. Privacy implication: if you’re a single-member LLC, your name + home address (if used as principal office) becomes public record. This is why some single-member LLC owners use a registered-agent address as the principal office.

#Filing deadlines + penalties

The PIR is mandatory even when you owe $0 tax

Even if your entity owes no franchise tax, you must still file your information report by May 15 every year, a PIR or an OIR depending on entity type, or the entity can forfeit its right to transact business in Texas.

Late filing brings a $50 penalty per report.
Forfeiture does not require two missed years. Under Tax Code §171.251, the Comptroller forfeits when a required report is not filed, or the tax or penalty is not paid, within 45 days after a notice of forfeiture is sent. A single delinquent report can get you there once that notice goes out. Under §171.252 the entity is then denied the right to sue or defend in a Texas court, and each director or officer becomes liable for certain company debts under §171.255.

The fix is simple: calendar May 15 and file your information report even in a zero-revenue year.

Annual due date: May 15 for most fiscal-year-end entities.

If May 15 falls on a weekend or holiday, the due date moves to the next business day.

Late filing penalty: $50 per report filed after the due date.

Forfeiture: the Comptroller forfeits an entity’s right to transact business when a required report is not filed, or tax or penalty is not paid, within 45 days after notice of forfeiture is sent (§171.251, extended to non-corporate taxable entities by §171.2515). No court proceeding is involved. The consequences are set by §171.252: the entity is denied the right to sue or defend in a Texas court, and each director or officer is liable for certain company debts as provided by §171.255.

Realistic timeline if you miss: one missed report costs the $50 penalty and starts a paper trail, and it is enough to put you in the forfeiture process once the Comptroller sends notice. The 45-day window in that notice is the thing to watch. See what forfeiture actually does and how to reinstate.

#What if I’m a new LLC?

For a new Texas LLC formed mid-year:

First report: due May 15 of the year following the year your entity became subject to the tax. Form in March 2026 and your first annual report is due May 15, 2027.
No separate “initial report.” An entity first subject to franchise tax on or after Oct. 4, 2009 files a first annual report instead of an initial report, so the old 30-day initial report does not apply to anything formed in the last decade and a half.
The dates that confuse people are the accounting period dates, not the due date. For a first annual report, the accounting year BEGIN date is the day you became subject to the tax, which for a Texas entity is its Secretary of State registration date. See the first-report walkthrough for the end-date rule, which has its own wrinkle.
Best practice: when you form, calendar May 15 of the following year immediately.

#What if I’ve already missed filings?

Sort yourself by current status, not by how many years you missed. The number of missed years drives the paperwork; your status drives the process, and they are not the same question.

Delinquent, not yet forfeited. File the late report or reports, one per year missed, and pay the $50-per-report penalty plus any tax and interest actually owed. This is the cheap path, and it is the one that closes on its own once the filings post. If a notice of forfeiture has already been sent, the 45-day cure period in that notice is your deadline.

Rights already forfeited. Back filings alone do not restore you here. You file everything outstanding and pay what is owed, then request a tax clearance letter (Form 05-391) from the Comptroller, then file for reinstatement with the Secretary of State. Two agencies, in that order. Budget weeks, not days.

Full walkthrough: what forfeiture does and how to reinstate.

Not sure which you are? Check your franchise tax account status with the Comptroller before doing anything else. It determines the whole path, and guessing wrong wastes the most time.

#How filing works

The Texas Comptroller’s eSystems web portal handles filing electronically:

Visit comptroller.texas.gov
Log in to Webfile (requires a registered account with the Comptroller)
Select the appropriate report year
Complete your applicable information report
Submit + receive confirmation

The steps above assume you file the PIR, which covers corporations, LLCs, and similar entities. Entities that do not file a PIR file the OIR instead, on its own form. Paper filing is available for the PIR (Form 05-102), but electronic is faster and confirms receipt immediately.

For above-threshold entities, you’ll also file the full franchise tax report (Form 05-158 or 05-163 depending on calculation method). That filing requires more financial detail and typically warrants accounting support.

#When franchise tax becomes meaningful

For most small businesses in Texas under the $2.65M threshold, franchise tax is a filing obligation rather than a tax bill: file the information report on time and no tax is owed. File it on time and there is no $50 either. The $50 is a late penalty per report, not an annual fee. Which form you file depends on the entity: a PIR for corporations, LLCs, and similar entities, an OIR for those that do not file a PIR.

The math changes once revenue crosses the threshold, but it is bounded. Under §171.101 margin is the least of several statutory computations: 70% of total revenue, total revenue minus $1 million, or total revenue minus the greater of $1 million or your COGS or compensation deduction. The rate is 0.75% generally or 0.375% for qualifying retail and wholesale.

The figures below use only the first two of those computations, which is what sets the ceiling. Your actual margin can be lower if COGS or compensation produces a smaller number. At $3M of total revenue, margin tops out near $2M, so roughly $15,000 at the general rate or about $7,500 at the retail/wholesale rate. At $10M, margin tops out at $7M, so roughly $52,500 general or $26,250 retail/wholesale. Actual figures come in lower whenever COGS or compensation produces a smaller margin, and the EZ computation (0.331% of total revenue, available at $20 million or less of annualized total revenue) is sometimes better still.

Strategic planning: many businesses can elect the calculation method (EZ method vs. standard) annually to minimize the tax owed. We model this for clients above the threshold as part of the annual return preparation.

#Common questions

Do I have to file PIR if my LLC has zero revenue? Yes. Filing is required regardless of revenue. Below the no-tax-due threshold (which includes zero revenue), you owe no tax but you still file the PIR.

Can my registered agent file the PIR for me? Yes. Many registered agent services include franchise tax / PIR filing as part of their package. Northwest Registered Agent, ZenBusiness, LegalZoom all offer this for a fee.

What if my LLC is dissolved but I never filed the final PIR? File the final report and information report, then request a Certificate of Account Status to Terminate using Form 05-359. That form is a request for the certificate, not a notice of termination, and receiving it does not by itself end the entity. The certificate is what you take to the Secretary of State to complete the actual termination filing. Two agencies, two steps, in that order.

Do I need to file for my out-of-state LLC if I’m not in Texas? Registration with the Texas Secretary of State is not the test. Texas franchise tax has its own economic nexus rule: under 34 TAC §3.586, a foreign taxable entity has nexus, with or without physical presence, if it had gross receipts from business done in Texas of $500,000 or more during the federal income tax accounting period. An out-of-state entity with no Texas presence and Texas receipts well under that generally has no franchise tax obligation. One that crosses $500,000 can have one whether or not it ever registered.

What if my business is online and customers are in Texas? The $500,000 franchise tax economic nexus threshold above is the one that matters here, and it is a separate question from sales tax. Sales tax has its own Wayfair-style economic-nexus rules with their own threshold and their own filings. It is entirely possible to trip one and not the other, so do not treat a conclusion about one as an answer for the other.

Is there a way to make the PIR private? No. The PIR is intentionally a public record. Using a registered-agent address as the principal office prevents your home address from being public.

What about the Texas Margin Tax vs. Franchise Tax? Same thing. Texas franchise tax is calculated on taxable “margin” (a defined Texas concept). The colloquial “Texas Margin Tax” is just another name for franchise tax.

If you’re a Texas LLC owner and want to make sure your PIR is current + your franchise tax is filed correctly, the Tax Returns service handles annual filings as part of the standard engagement. For LLC formation in Texas with PIR/franchise tax setup, see Business Formation.