Single Member LLC in Texas: Does it Need to File Franchise Tax Return?

Does a single member LLC need to file a Texas franchise tax return?
For example, Texas single member LLCs do not need to file an annual report. You will be required, however, to submit an annual franchise tax report. In general, single member LLCs are pass-through entities, which means the organization itself does not pay taxes.
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You might be unsure if you must submit a Texas franchise tax report if you manage a single-member limited liability corporation (LLC) in Texas. The short answer is that you must still submit a Texas franchise tax return even if you are the only member of your LLC.

This is due to the fact that the Texas franchise tax is a fee for the right to conduct business in Texas rather than a tax on your LLC’s income. This implies that you must submit a Texas franchise tax report and pay the minimum amount of tax, which is $0.25 per $100 of taxable margin, even if your LLC has no income for the year.

Your LLC might need to submit an annual report to the Texas Secretary of State in addition to filing a Texas franchise tax return. An updated list of your LLC’s owners, managers, and address information can be seen in the annual report. The annual report has no filing cost, but failing to submit it could lead to your LLC being administratively disbanded.

A Texas Public Information Report (PIR) must be submitted yearly in order to renew your LLC in Texas. A document called the PIR contains up-to-date details about your LLC, including its name, address, and registered agent. Similar to the annual report, there is no filing fee for the PIR, but failing to submit it could lead to your LLC being administratively disbanded.

You must submit a Certificate of Formation to the Texas Secretary of State in order to activate your LLC there. Your LLC becomes a recognized legal company in Texas thanks to the Certificate of Formation, a legal document. The Certificate of Formation must be filed for a charge of $300. The bottom line is that even if you operate a single-member LLC in Texas, you must still submit a Texas franchise tax return and pay the minimum amount of tax payable. A Texas Public Information Report as well as an annual report must be submitted to the Texas Secretary of State in order to maintain your LLC’s good standing. You must submit a Certificate of Formation in order to activate your LLC in Texas. To avoid fines or administrative dissolution of your LLC, it’s critical to stay current with these regulations.

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