Annual Requirements for LLC Formed in Texas

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Whenever a business is registered as a corporation or an limited liability company, it's chartered to do business by the specific state where it forms. In Texas, there are a few requirements placed on locally formed limited liability companies that require them to report their taxes, the names of company owners and office address, and pay business taxes. As with all other limited liability companies, those formed in Texas must submit to the annual requirements of the federal government as well.

Annual Reporting

All LLCs formed in Texas must report their membership to the state government with annual tax reports.
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Every LLC formed in Texas is required to file an annual public information report with the Office of the Comptroller. The report is actually a fairly simple document, and it's unlikely that a business would find the procedure too onerous. Many states require additional annual reporting to the Secretary of State, but Texas does not. The annual report should be submitted with franchise or margin Tax payments and is due before May 16. Recent changes to the Texas tax code have updated the due date and content requirements of annual reports for LLCs in Texas.

Franchise or Margin Taxes

All businesses incorporated in Texas are required to submit an annual margin tax based on their gross receipts. Like the annual report, this tax is submitted to the State Comptroller. The amount of tax liability is reported on an annually submitted document, also due before May 16. The tax applies both to Texas companies and those not formed in Texas who do business in the state. Taxes are based on the company's taxable capital, which can be calculated with the assistance of either a professional accountant or by using forms provided by the State Comptroller. Companies with a tax liability of less than $100 are entirely exempted from the tax and won't submit a payment for that year, though they will be required to report their liability on the deadline.

Federal Requirements

Limited liability companies with only one member can file its taxes on that member's return.
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Like all limited liability companies, those formed in Texas must meet the annual requirements of the federal government. All companies with employees must pay regular payroll taxes and submit a return. Those without employees are still likely to have income tax liabilities and must submit a return, though it may be included in the personal return of the company's owner if its membership is limited to a single individual. Any LLC with multiple members must file its own tax return. This is an important distinction, and failing to pay attention to the difference between an LLC filing as a partnership or corporation and a single member LLC can result in an audit.

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About the Author

Matt Petryni has been writing since 2007. He was the environmental issues columnist at the "Oregon Daily Emerald" and has experience in environmental and land-use planning. Petryni holds a Bachelor of Science of planning, public policy and management from the University of Oregon.

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