The Texas franchise tax is a privilege tax imposed on corporations, including banking corporations and limited liability companies, that are chartered in Texas. The tax is also imposed on non-Texas corporations that do business in Texas.
The franchise tax is imposed on each corporation that is chartered in Texas. Non-Texas corporations doing business in Texas are also liable for the tax. See Franchise Tax Rule 3.586(c) for a list of some activities considered to be “doing business in Texas.”
For franchise tax purposes, the term “corporation” also includes a bank, state limited banking association, savings and loan association, limited liability company, professional limited liability company, a corporation that elects to be an S corporation for federal income tax purposes, and a professional corporation. However, professional associations and partnerships are not subject to the franchise tax.
Contact Dan Martinez & Associates today with any questions you have regarding your Texas Franchise Taxes, no matter where you are in the process!