Reviewed and updated October 16, 2026

Check the report year and the entity

Texas franchise tax is a statewide obligation, not a separate Houston business income tax. Start with the entity, its activities and the report year. The financial period used to calculate a report does not necessarily match the year shown on its title.

For the 2026 franchise-tax report, the Comptroller lists a $2.65 million no-tax-due threshold, measured using annualized total revenue. Do not compare that threshold with net profit or assume every deposit belongs in the revenue calculation. Short periods and combined groups need particular care.

Understand which filing remains

For reports due in 2024 and later, qualifying entities at or below the threshold no longer file the old No Tax Due Report. An information report may still be required. An LLC generally uses the Public Information Report; other entity types may use the Ownership Information Report. Specific exemptions and special entities have their own rules.

Federal tax classification does not resolve every Texas requirement. A single-member LLC’s federal treatment is not, by itself, permission to ignore state notices. Filing required information helps maintain the account even when no franchise-tax payment is due.

Build an annual compliance file

Keep formation details, current ownership and management information, prior filings, financial statements and Comptroller correspondence together. Compare names, addresses and report-year details before submitting. Save the acceptance confirmation and verify account status afterward.

If a notice indicates missing information, review the exact period and requirement promptly rather than sending a payment without the missing report. Ask our team to review the books and filing history together, especially after an ownership change, additional business location or a new entity. A repeatable calendar is more useful than relying on last year’s zero balance.

Official sources

This guide provides general information. The rules depend on the tax year, jurisdiction and your circumstances. Ask our team which filing or planning steps apply to you.