Texas LLC Franchise Tax & PIR — Step 6 of 8
Texas has no personal income tax, but Texas LLCs can have annual franchise-tax reporting obligations. For the 2026 report year, entities with annualized total revenue of $2.65 million or less generally owe $0 franchise tax. Most Texas LLCs still need to file a Public Information Report (PIR) by May 15, although limited exceptions apply.
For the 2026 report year, a Texas LLC with annualized total revenue of $2.65 million or less generally owes $0 franchise tax. Most Texas LLCs still must file a Public Information Report (Form 05-102) by May 15, even when no tax is due. The Comptroller says there is no $50 late-filing penalty for a PIR or OIR, but failing to satisfy required franchise-tax filings can eventually lead to forfeiture consequences. File through the Comptroller's Webfile system.
- No-tax-due threshold
- $2.65M (2026)
- Most small LLCs owe
- $0
- PIR required?
- Generally yes*
- PIR form
- 05-102
- Due date
- May 15 (annual)
- Standard rate
- 0.75%
- Late penalties
- $50 report penalty†; 5–10% tax
- File via
- Comptroller Webfile
- Important
- *Limited PIR exceptions apply
* Most Texas LLCs file Form 05-102, but limited exceptions apply. † The $50 late-report penalty applies to a late franchise tax report; the Comptroller states there is no $50 penalty for late PIR/OIR filing.
Does Your Texas LLC Owe Franchise Tax?
Texas doesn't have a personal income tax, but it does levy a franchise tax — a privilege tax on entities doing business in the state. Here's the part most owners get wrong: the tax applies at the entity level, so it covers your LLC even if you're a single-member LLC treated as a "disregarded entity" for federal taxes, and even if you elected S-corp status.
The relief is that most small LLCs owe $0. For the 2026 report year, if your annualized total revenue is $2.65 million or less, your franchise tax is zero. You'll only owe tax once you cross that threshold.
"Annualized total revenue" ≠ profitThe threshold is based on total revenue, not net income or what's in your bank account. "Annualized" means if your LLC operated less than 12 months, you scale the revenue up to a full year before comparing it to $2.65M.
The $2.65 Million No-Tax-Due Threshold
The threshold has climbed fast: it was $1.23M through 2023, jumped to $2.47M for 2024–2025, and rises to $2.65 million for the 2026 and 2027 report years (Texas adjusts it for inflation). That increase means more Texas LLCs than ever owe nothing.
But "owe nothing" does not always mean "file nothing." Most Texas LLCs still have an annual information-report requirement, even when no franchise tax is due.
Franchise Tax & PIR Estimator
Enter your LLC's annualized total revenue to see whether you owe franchise tax for 2026 — and a reminder of what you must file either way:
Estimate only. Above the threshold, the Long Form figure uses the 70%-of-revenue margin method (an upper bound) and the EZ figure applies 0.331% to revenue. Your actual tax is usually lower — Texas lets you use the lowest of four margin methods after deductions. Not tax advice; confirm with the Comptroller or a CPA.
The Public Information Report (PIR) — Don't Skip This
For 2026, most Texas LLCs must file a Public Information Report (Form 05-102) with the Comptroller by May 15, even when no franchise tax is due. The old No Tax Due Report is no longer required for entities at or below the threshold for reports due on or after January 1, 2024. Limited exceptions to the PIR/OIR requirement include qualifying passive entities and qualifying new veteran-owned businesses during their qualifying period.
The PIR asks for your LLC's taxpayer number, the names and addresses of your members or managers, and your current registered agent information. That data is forwarded to the Secretary of State and becomes public record — another reason to keep your registered agent details accurate.
Do not ignore a required PIR or franchise-tax filingIf required franchise-tax filings or payments remain unresolved after the Comptroller's notice process, the entity's right to transact business can be forfeited. The Comptroller says a forfeited entity is generally denied the right to sue or defend in a Texas court, and specified officers, directors, partners, members, or owners can become liable for certain debts of the entity. This is more specific than saying the LLC automatically loses all liability protection.
Your first PIR is due the year after you formAn LLC formed in 2025 files its first PIR by May 15, 2026. An LLC formed in 2026 doesn't file until May 15, 2027. The deadline is a fixed annual date — not your formation anniversary.
If You're Above the Threshold: How the Tax Is Calculated
Cross $2.65M and you calculate tax on your taxable margin, then apply your rate. Texas gives you four ways to figure margin, and you legally use whichever is lowest:
- 70% of total revenue
- Total revenue minus cost of goods sold (COGS)
- Total revenue minus compensation (capped at $480,000 per person for 2026)
- Total revenue minus $1 million
| Method | Rate (2026) | Notes |
|---|---|---|
| Standard (most LLCs) | 0.75% | Applied to taxable margin |
| Retail / wholesale | 0.375% | For qualifying retailers/wholesalers |
| EZ Computation | 0.331% | Revenue ≤ $20M; applied to gross receipts; no deductions or credits |
Because EZ forfeits deductions and credits, it isn't always cheaper. If you're above the threshold, run both the Long Form and EZ before you file — this is the point where a CPA usually pays for themselves.
Deadlines, Penalties & Extensions
- Due date: May 15 every year (the next business day if it's a weekend/holiday).
- $50 late-report penalty: the Comptroller assesses $50 on a late franchise tax report. It specifically states there is no $50 penalty for late filing a PIR or OIR.
- 5% penalty on tax paid 1–30 days late; 10% when tax is paid more than 30 days late, with interest beginning on day 61.
- Extension: a timely extension can generally move the filing deadline to November 15. The usual payment test is 90% of current-year tax or 100% of prior-year tax by May 15. The prior-year option is not available for a first annual report, and an entity below the no-tax-due threshold may request a no-payment extension for its PIR/OIR.
How to File (Webfile)
- Log in to Webfile on the Comptroller's site with your 11-digit taxpayer number and XT Webfile number (on the reminder letter mailed in January, or by calling the Comptroller).
- Select the 2026 franchise tax report for your entity.
- If your LLC is at or below $2.65M and is required to file a PIR, you generally file Form 05-102 without a franchise-tax report or tax calculation.
- If you're above the threshold, determine whether the Long Form or EZ Computation applies, then complete the required information report.
- Enter your member/manager and registered agent details on the PIR and sign.
- Submit, pay any tax due, and save your confirmation as proof of filing.
- ✓Sends reminders before your May 15 franchise tax / PIR deadline
- ✓Keeps your registered agent info current — which the PIR reports
- ✓1 FREE year of Texas Registered Agent ($125 value)
- ✓No upsells · No data selling · Privacy by Default
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Official sources checked August 2026Key figures and filing rules on this page were checked against current Texas Comptroller franchise-tax forms, rates, PIR/OIR guidance, extension FAQs, and forfeiture guidance. Because tax rules can change, confirm important filing decisions with the Comptroller or a qualified tax professional.
Texas Franchise Tax & PIR — FAQ
Enjoys-life Team is the founder of Enjoys-life. The key 2026 figures on this page — including the $2.65M threshold, May 15 due date, 0.75%/0.375%/0.331% rates, and PIR filing rules — were checked against current Texas Comptroller guidance in August 2026. See Enjoys-life's Editorial Policy and Corrections Policy.
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