Forming your LLC with the Texas Secretary of State does not license it to operate. In Texas, register for any state taxes that apply to your business and check with your city and county for local business licenses.
Register for Sales Tax and Local Permits
If you sell taxable goods or services, get a free sales and use tax permit from the Texas Comptroller. Texas has no general statewide business license, but many occupations are licensed by state boards, contractors in the electrical, HVAC, and plumbing trades need state licenses, and cities often require their own registration.
What's Different About Texas
- No state personal income tax.
- Most small LLCs owe $0 in franchise tax, but must still file a report every year by May 15.
- For 2026 and 2027 reports, the no-tax-due threshold is $2.65 million in annualized revenue.
Licensed professions and regulated activities (contractors, food, alcohol, transportation, health care) may need additional state board licenses. Verify your specific activities with the state and your city.
Ongoing Texas Requirements
- Franchise tax report and Public Information Report: due May 15 each year, starting the year after formation.
- Sales tax returns if you hold a sales tax permit.
- Update the Secretary of State if your registered agent changes (Form 401).
- If you have employees and no workers' comp: file DWC Form-005 every year between February 1 and April 30.
- Renew any trade or professional licenses and keep license-required insurance in force.
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Frequently Asked Questions
What is the Texas franchise tax no-tax-due threshold?
For reports due in 2026 and 2027, LLCs with annualized total revenue at or below $2.65 million owe no franchise tax. The threshold is adjusted periodically.
Official Sources
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