Franchise Tax Forfeiture in Texas
Resolve tax forfeiture quickly.
Failing to file a franchise tax report or pay the required tax results in forfeiture by the Texas Comptroller under Tax Code §171.
We help you identify exactly what is missing and guide you through the process of restoring your Certificate of Account Status and obtaining a Certificate of Reinstatement.
Once corporate privileges are forfeited for franchise tax reasons, officers and directors become personally liable for debts created. Resolving this immediately is essential to protect your personal assets.
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We'll verify your entity's current status and send you a clear summary.
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*If you cannot locate this, leave blank. We can obtain it via Power of Attorney (a fee of $200 applies for a digitally signed and filed POA to the Comptroller).
Franchise Tax Forfeiture
Understanding the role of the Texas Comptroller in entity compliance.
Comptroller Focus
The Texas Comptroller of Public Accounts is responsible for collecting the state franchise tax. If an entity misses the May 15th deadline (or extended deadline) for filing its report or paying its tax, the Comptroller will forfeit its corporate privileges. This is strictly a compliance enforcement mechanism under Tax Code §171.
Common Misconceptions
Many business owners mistakenly believe that if their entity had zero revenue, they don't need to file a report. This is false. Every taxable entity in Texas must file an annual franchise tax report, even if it is a "No Tax Due" report. Failing to file this simple informational report is the #1 cause of franchise tax forfeiture in Texas.
Your Path to Compliance
A complete framework for Texas entity good standing.
Understand Good Standing
Learn what it means for your Texas entity to be in good standing and why it matters for contracts, banking, and liability.
Restore Good Standing
Lost your status? We help you navigate the Comptroller and Secretary of State to get it back quickly and correctly.
Maintain Good Standing
Stay compliant year-round. Understand franchise tax reporting requirements to prevent future forfeiture.
Prevent Future Problems
Build a system of money that scales with your business. Listen to our podcast to move from reacting to leading.
What Happens If You Do Nothing?
Under Tax Code §171, ignoring a forfeited or revoked status in Texas carries severe consequences that escalate over time.
Bank Account Freezes
Financial institutions regularly check entity status. Forfeiture often triggers immediate account holds and loan defaults.
Contract Invalidity
You lose the right to defend your business in Texas courts, and existing contracts may become unenforceable.
Personal Liability Exposure
Officers and directors can become personally liable for business debts created during the forfeiture period.