Texas Franchise Tax + PIR: The 2026 Practical Guide

TLDR

Texas franchise tax applies to every Texas-domiciled (or Texas-doing-business) corporation, LLC, partnership, and similar entity. 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 the Public Information Report (PIR) annually

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 — small entities under the threshold now file ONLY the 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 the forfeiture risk after 2 consecutive missed years
Walk through the catch-up process if you’ve missed 1, 2+, or are already in forfeited status

$2,650,000

No-tax-due threshold

2026 annualized revenue
May 15

Annual due date

PIR required 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	PIR required
≤ $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 PIR filing is mandatory.

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

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: if PIR is not filed AND no franchise tax filings happen for two consecutive years, the Texas Comptroller can forfeit the entity’s right to transact business in Texas. This means contracts may become unenforceable, the entity name becomes available to others, and reinstatement requires filing back PIRs + paying penalties.

Realistic timeline if you miss: missing one year + $50 penalty = no business impact. Missing two consecutive years = forfeiture risk + reinstatement headache.

#What if I’m a new LLC?

For a new Texas LLC formed mid-year:

First PIR: due May 15 of the year AFTER your first full fiscal year. If you formed in March 2026, your first PIR is due May 15, 2027.
Initial report: in some cases (especially for entities registering as foreign LLCs), an Initial Report is due within 30 days of starting business in Texas.
Best practice: when you form a new LLC, calendar the May 15 PIR for the next year so you don’t miss the first one.

#What if I’ve already missed filings?

Common scenarios:

Missed 1 year, current year on time: file the late PIR, pay $50 penalty, you’re caught up. Quick fix.

Missed 2+ years, no tax due: file all back PIRs (one form per year), pay $50 per year in penalties. Entity is restored to good standing once the Comptroller processes the filings.

Forfeited entity: file for reinstatement, file all back PIRs, pay all penalties, possibly re-register. More substantial cleanup. Typically takes 30-60 days to process.

#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 the PIR form
Submit + receive confirmation

Paper filing is also available (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 ETS-client small businesses in Texas (single-member LLCs, S-corps, small partnerships with revenue under $2.65M), franchise tax is a $50/year compliance issue — file the PIR, no tax owed.

The math changes once revenue crosses the threshold. At $3M revenue, your franchise tax obligation might be $5K-$15K depending on margin and calculation method. At $10M revenue, it can be $25K-$80K+.

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 a Final PIR and Form 05-359 (Notice of Termination). Once processed, the entity is dissolved with the Comptroller and no further filings are required.

Do I need to file a PIR for my federal LLC if I’m not in Texas? Only if your LLC is registered to do business in Texas. An out-of-state LLC with no Texas operations, no Texas employees, and no Texas-source income doesn’t have Texas franchise tax obligation.

What if my business is online and customers are in Texas? “Doing business in Texas” includes substantial nexus from sales to Texas customers, even if you have no physical presence. Wayfair-style economic-nexus rules apply. Most small online sellers don’t cross the threshold; check with your tax preparer if revenue from Texas customers is substantial.

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.