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171.001. TAX IMPOSED. (a) A franchise tax is imposed on each taxable entity that does business in this state or that is chartered or organized in this state. (b) The tax imposed under this chapter extends to the limits of the United States Constitution and the federal law adopted under the United States Constitution.

Under the Texas Tax Code, Section 171.301?. 3015, the State Comptroller may cause the involuntary forfeiture of an entity for failure to pay its franchise tax. Under Section 171.309, the Texas Secretary of State may also forfeit an entity's charter, certificate, or registration for the same purpose.

For franchise tax reporting purposes, the entity would file its 2023 report based on the period 10-01-2021 through 12-31-2022, combining the relevant information from the two federal income tax reports.

A nonprofit corporation organized solely to promote the public interest of a city, county, town or other area within Texas is exempt from franchise tax. The corporation must show that promotion of the public interest is its exclusive purpose and not merely an incidental result.

The Texas tax power of attorney (Form 01-137) designates an agent to represent a taxpayer before the Texas Comptroller of Public Accounts. In most cases, it is accountants or attorneys that are appointed, although any individual can be named as the taxpayer's agent.

For the 2023 report year, a passive entity as defined in Texas Tax Code Section 171.0003; an entity that has total annualized revenue less than or equal to the no tax due threshold of $1,230,000; an entity that has zero Texas gross receipts; an entity that is a Real Estate Investment Trust (REIT) meeting the ...