Texas Franchise Tax 2026: No-Tax-Due Threshold & PIR/OIR Rules
Texas Franchise Tax in 2026: What Businesses Need to Know
Texas franchise tax rules changed significantly for many smaller businesses in recent report years, but “no tax due” does not always mean “nothing to file.”
For 2026 and 2027, the Texas Comptroller lists the franchise tax no-tax-due threshold at $2,650,000. For reports due on or after January 1, 2024, an entity with annualized total revenue at or below the no-tax-due threshold is generally not required to file a No Tax Due Report.
However, many taxable entities still need to file a Public Information Report (PIR) or Ownership Information Report (OIR). Missing that information report can create serious consequences, including forfeiture of the entity’s right to transact business in Texas.
Here is what Texas LLCs, corporations, and out-of-state companies with Texas nexus should understand for the 2026 reporting cycle.
Important note: This article is general information, not tax or legal advice. Texas franchise tax rules can depend on entity type, revenue, nexus, exemptions, combined reporting, and other facts. Confirm requirements with a tax professional.
Who is subject to Texas franchise tax?
The Texas Comptroller describes the franchise tax as a privilege tax imposed on each taxable entity formed or organized in Texas or doing business in Texas.
That means Texas franchise tax can matter for:
- Texas LLCs;
- Texas corporations;
- Texas limited partnerships;
- professional associations and certain financial institutions;
- out-of-state entities with Texas nexus; and
- combined groups with Texas members or nexus.
Even if a business owes no tax, it should confirm whether it has filing or information-report obligations.
2026 and 2027 Texas franchise tax threshold and rates
For 2026 and 2027, the Texas Comptroller lists:
- No Tax Due Threshold: $2,650,000
- Tax Rate for retail or wholesale: 0.375%
- Tax Rate for other businesses: 0.75%
- Compensation Deduction Limit: $480,000
- EZ Computation Total Revenue Threshold: $20 million
- EZ Computation Rate: 0.331%
The no-tax-due threshold increased from the 2024 and 2025 amount of $2,470,000.
Businesses should use the rate, threshold, and deduction limit that corresponds to the report year they are filing. Do not assume last year’s threshold still applies.
When is the Texas franchise tax report due?
The annual Texas franchise tax report is generally due May 15. If May 15 falls on a weekend or holiday, the deadline moves to the next business day.
For many businesses, the May 15 date should be paired with review of the Public Information Report or Ownership Information Report.
A new taxable entity generally files its first annual report on May 15 of the year after the year it became subject to the tax.
No Tax Due Report vs. PIR/OIR: the important distinction
Texas eliminated the No Tax Due Report requirement for many entities under the threshold for reports due on or after January 1, 2024.
But the Texas Comptroller’s PIR/OIR guidance states that a PIR or OIR is still due even if the entity does not have to file a franchise tax report because its annualized total revenue is at or below the no-tax-due threshold.
That distinction is easy to miss:
- No Tax Due Report: may not be required when annualized total revenue is at or below the threshold.
- PIR or OIR: may still be required annually, depending on entity type and Texas nexus.
This is one of the most important Texas compliance points for small and midsize businesses in 2026.
Who files a Public Information Report?
The Texas Comptroller says each taxable entity formed as a corporation, LLC, limited partnership, professional association, or financial institution that is organized in Texas or has Texas nexus must file a Public Information Report annually.
The PIR is due on the annual franchise tax report due date.
Officer and director information from PIRs may appear in public-facing state records after processing.
Who files an Ownership Information Report?
Entities that are not legally formed as corporations, LLCs, limited partnerships, professional associations, or financial institutions may need to file an Ownership Information Report instead.
The OIR is also due on the annual franchise tax report due date and must be signed by an appropriate partner, member, owner, or authorized person.
Ownership information on OIRs is confidential and is not displayed on the Comptroller’s website.
What happens if a business does not file a PIR or OIR?
The Comptroller warns that even if an entity does not have to file a franchise tax report because it is at or below the no-tax-due threshold, the entity may forfeit its right to transact business if it fails to file a completed and signed PIR or OIR.
The effects of forfeiture can include:
- denial of the entity’s right to sue or defend in Texas court; and
- personal liability for certain debts for each officer, director, partner, member, or owner.
That makes the PIR/OIR more than a minor administrative form. For many entities, it is a core annual compliance filing.
Can a Texas registered agent be changed on the PIR or OIR?
No. The Texas Comptroller says changes to the registered agent or registered office must be filed directly with the Texas Secretary of State and cannot be made on the PIR or OIR.
That means a business should treat registered-agent maintenance as a separate compliance workflow.
If your Texas registered agent has changed, or if your registered office information is outdated, file the appropriate change with the Secretary of State rather than assuming the annual information report will update it.
Texas compliance checklist for 2026
- [ ] Confirm whether the entity is organized in Texas or has Texas nexus.
- [ ] Confirm whether the entity is subject to Texas franchise tax.
- [ ] Determine annualized total revenue for the relevant report year.
- [ ] Check the correct no-tax-due threshold for the report year.
- [ ] Determine whether a franchise tax report is required.
- [ ] Determine whether a PIR or OIR is required.
- [ ] Calendar the May 15 due date.
- [ ] Confirm officer, director, member, partner, or owner information.
- [ ] Confirm whether registered agent or registered office information must be updated separately with the Secretary of State.
- [ ] Keep proof of filing and payment confirmations.
FAQ
What is the Texas no-tax-due threshold for 2026?
For 2026 and 2027, the Texas Comptroller lists the no-tax-due threshold as $2,650,000.
Do I still have to file a No Tax Due Report in Texas?
For reports due on or after January 1, 2024, an entity with annualized total revenue at or below the no-tax-due threshold is generally not required to file a No Tax Due Report. However, many entities still must file a PIR or OIR.
Is the PIR due even if my business owes no franchise tax?
The Texas Comptroller states that the PIR or OIR is due even if the entity does not have to file a franchise tax report because its annualized total revenue is at or below the no-tax-due threshold.
What is the deadline for Texas franchise tax reports?
The annual franchise tax report is generally due May 15. If May 15 falls on a weekend or holiday, the deadline moves to the next business day.
Can I update my Texas registered agent on the PIR?
No. Registered agent and registered office changes must be filed directly with the Texas Secretary of State. They cannot be made on the PIR or OIR.
Texas compliance is easier when your registered agent information is accurate and dependable. Rapid Registered Agent helps Texas businesses and out-of-state companies maintain reliable registered-agent coverage.