Texas Business Search
Texas franchise tax status
Quick answer. Texas franchise tax status, officially “franchise tax account status,” shows whether an entity has the right to transact business in Texas. The Comptroller used to call this good standing. Search it free with the taxpayer number or EIN. Forfeiture is serious: the Comptroller cites the loss of the right to sue and personal liability for directors and officers under the Tax Code.
Official office
Texas Secretary of State, Corporations Section
Phone: (512) 463-5555
Secretary of State, 400 W. 15th Street, Austin, TX 78701. Mail: P.O. Box 13697, Austin, TX 78711-3697.
SOSPortal is online 24/7. The Secretary of State states a $1 statutory fee for each search.
Steps
-
Run the status search
Use the franchise tax account status search and the explanation page. Print the result. It is a point-in-time statement.
-
Read the forfeiture timeline
The Comptroller says the law requires at least 45 days after a notice of pending forfeiture is mailed before the right to transact business is actually forfeited. Deficiencies have to be cured in that window. Once forfeited, the entity is denied the right to sue or defend in a Texas court, and directors or officers can be liable for the entity’s debts, under the sections the Comptroller cites: Tax Code 171.2515 and 171.255.
-
Do not use this status to reinstate at the SOS
The same instructions say that reinstating or terminating with the Secretary of State requires a certificate specific to that purpose. Order that certificate from SOSPortal. A green Comptroller status is not that certificate.
-
Public information reports are part of the tax story
Texas franchise tax includes a public information report for many entities, filed with the Comptroller, even when no tax is due because the entity is under the no-tax-due threshold. The report is not the SOS formation filing. If a form asks for officers or directors, the public information report is often where those names were last given to the state. Confirm the current instructions on the Comptroller’s franchise-tax pages before you skip a year.
No-tax-due is not the same as no filing
Many small entities owe no franchise tax and still have a filing obligation. A status that says the right to transact business is active means the Comptroller’s requirements, as of that search, are met. It does not mean the entity never had to file. Read the entity’s own notices or the Comptroller’s threshold instructions for the year in question.
Common mistakes
- Waiting out a forfeiture notice because someone said Texas has no income tax. Franchise tax is a different tax.
- Sending the SOS a Comptroller printout as if it were the reinstatement certificate.
- Checking status once at formation and never again. Forfeiture can happen years later.
Questions
What did “Texas Comptroller good standing” become?
The Comptroller now calls it franchise tax account status. The instructions page says it was previously referred to as good standing and that it shows the right to transact business in Texas.
How long is the notice before forfeiture?
The Comptroller says the law requires at least 45 days after the notice of pending forfeiture is mailed. Cure the deficiency in that period if you want to avoid forfeiture.
Who do I call about a franchise tax account?
The Comptroller, at (800) 252-1381, listed on the account-status instructions. The Secretary of State’s (512) 463-5555 line is for SOS filings.