How to File a Texas Franchise Tax Report

The Texas franchise tax is a tax that is levied on all the taxable entities of Texas, the collection of this tax is controlled by the Texas comptroller. The tax is calculated on the basic margin of the business or entity, and there are also different methods to calculate this tax. Every business who are carrying out their transactions in Texas is bound to file an annual franchise tax report by the 15th of March every year. Businesses avoiding the filing of the report may fall into legal troubles.

A business that is new to the Texas market might find this filling confusing. So to make it easy for them, the detailed process of filing the Texas franchise tax report is given in this article along with some other information.

Prerequisites Before Filing a Franchise Tax Report

You require to make somethings before filing a Franchise Tax Report in Texas. The checklist should be as follows:

  • Texas WebFile Number: This is the WebFile number that is attached in the returns form that the state has sent. It is located in the top left corner and starts with the letter RTxxxx or XTxxxx.
  • A Texas Taxpayer number is also required to file a Franchise Tax Report. So this number is also mandatory.

Filing a Franchise Tax Report

If you have a business in Texas, then you must learn how to file a Texas franchise tax report as soon as possible in order to avoid all the late fees. This report is filed after the closing of the sales tax account. The filing process of the franchise tax report is as follows:

  • The first step is to visit the Texas Comptroller of Public Accounts site and log in with the username and password that is registered in the site.
  • Select the option WebFile/Pay Taxes and Fees and then fill up all the information the site is asking for.
  • Once you have entered the WebFile number, the site will show you a number of returns that are required to be filed by you.
  • After filing all the returns, make a call to the state and request them to give you a final return based upon the returns you have filed.
  • The state will update the account in less than 48 hours, so when you will log in the account after 48 hours, you will find a final return.
  • In case your business is not registered with the Secretary of State, you must send a letter to them stating that you have closed your business on this date of the year and want that the state took up all your tax responsibilities.
  • If your business is registered, then demand a certificate of termination. This certificate will eliminate the state’s responsibilities on your taxes.

The Bottom Line

A business to carry out its operations in Texas must consider filing a Texas Franchise Tax Report in order to avoid legal troubles. A business is working as per the state rules by filing this report, thus avoiding every legal trouble.

Lakisha Davis

Lakisha Davis is a 20-year-old business studies student who enjoys watching tv shows, stealing candy from babies, and listening to the radio. She is creative and friendly, but can also be very boring and a bit selfish.

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