Texas LLC
Form a Texas LLC with no state income tax. Real Otonomos pricing, the mandatory annual filing, and what to budget for year one.
$470
One-time formation cost through Otonomos
0%
Texas has no personal state income tax
$2.65M
Revenue threshold below which no Franchise Tax is owed for the 2026 report
May 15
Annual Franchise Tax Report and Public Information Report deadline — mandatory even at $0 owed
Texas LLC, at a glance
| Regulator | Texas Secretary of State / Texas Comptroller of Public Accounts |
| Governing law | Texas Business Organizations Code |
| Minimum members / managers | 1 — can be a single non-resident individual or entity |
| Local resident director required? | No |
| Foreign ownership | 100% allowed |
| State personal income tax | None |
| Mandatory annual state filing | Public Information Report + Franchise Tax Report, due May 15 — no fee if under the no-tax-due threshold |
| No-tax-due revenue threshold (2026) | US$2.65 million |
| Time to incorporate | Often within 2 business days of a complete filing |
| Beneficial ownership reporting | Eliminated for domestic entities — FinCEN's August 2026 final rule |
1. Why Texas
Texas combines no personal state income tax with a genuinely low-friction annual compliance story for most small entities: below the no-tax-due revenue threshold, there's no franchise tax bill at all. The state's reputation as a business-friendly, no-annual-report jurisdiction is largely accurate for the tax itself — but "no fee" isn't the same as "no filing," and that distinction trips up more founders than it should.
Use cases: operating companies expanding physically into Texas, holding structures in a no-income-tax state with lower ongoing compliance friction than California or Nevada, and founders who want US banking access without Nevada's higher formation cost.
Formation requires no US visit and no US Social Security Number. Non-resident, non-citizen founders can own a Texas LLC 100%.
2. The process, step by step
Choose and clear your LLC name. Must be distinguishable from existing Texas entities and include an LLC designator.
File a Certificate of Formation with the Texas Secretary of State. The state filing fee is US$300.
Adopt a Company Agreement (Texas's term for an operating agreement). Not filed with the state, provided as a template as part of the base package.
Get your EIN from the IRS. Free and instant with a US Social Security Number; otherwise Otonomos handles the filing for US$180.
File your Public Information Report and Franchise Tax Report with the Texas Comptroller by May 15 every year — mandatory regardless of whether any tax is actually owed.
3. The honest number: what a Texas LLC actually costs
Most guides quote the US$300 state filing fee and call Texas cheap. It largely is — but here's the full cost of forming and maintaining a Texas LLC through Otonomos:
| Item | Frequency | Cost |
|---|---|---|
| Incorporation | One-time | US$169 |
| Government fee | One-time | US$301 |
| One-time subtotal | US$470 | |
| Registered agent and local address | Annual | US$216 |
| Otonomos annual subtotal | US$216 | |
| Total, year one (Otonomos fees only) | US$686 |
That US$686 is what you pay Otonomos. Texas itself charges no fee for the Public Information Report and Franchise Tax Report if your total revenue stays under the 2026 no-tax-due threshold of US$2.65 million — but the filing is still mandatory, every year, by May 15, whether or not you owe a dollar. Skipping it because "we don't owe tax" risks forfeiture of the LLC's right to transact business and, eventually, involuntary termination by the state.
A few optional services worth pricing out before you need them:
| Add-on | Frequency | Cost | Direct link |
|---|---|---|---|
| Nominee Manager | Annual | US$880/year | Add to cart → |
| Nominee Member | Annual | US$600/year | Add to cart → |
| EIN Application | One-time | US$180 | Add to cart → |
| Fiat Bank Account Opening, US | One-time | US$2,260 | Add to cart → |
| Crypto Exchange Account Opening | One-time | US$1,200 | Add to cart → |
| Cross-jurisdictional Guidance & Structuring Advice | One-time | US$2,000 | Add to cart → |
Otonomos's catalog still lists a "Beneficial Ownership Registry" filing add-on for US$200. As of FinCEN's final rule in August 2026, domestic LLCs are permanently exempt from federal beneficial ownership reporting — for a standard Texas LLC, this filing is no longer necessary. Confirm with support before adding it.
4. What you owe every year, regardless
Public Information Report + Franchise Tax Report — filing mandatory, tax usually $0
Due every year by May 15 with the Texas Comptroller. No tax is owed if total revenue is under the no-tax-due threshold — US$2.65 million for the 2026 report — but the report itself must still be filed. Missing it risks forfeiture of the right to transact business in Texas, and eventually involuntary termination.
Registered agent and local address — Otonomos's US$216/year
Mandatory for the life of the LLC.
No separate annual report fee
Unlike Florida or Nevada, Texas doesn't charge a standalone annual report fee — the Public Information Report is bundled with the (often $0) Franchise Tax filing instead.
5. What to avoid
- Don't skip the Franchise Tax Report because you owe $0. The filing is mandatory every year regardless of the tax due, and the state doesn't distinguish "we forgot" from "we're avoiding it" when applying consequences.
- Don't assume "no annual report" is entirely accurate. Texas doesn't charge a report fee, but the Public Information Report and Franchise Tax Report filings themselves are still required by May 15.
- Don't add the Beneficial Ownership Registry filing by default. As of August 2026, domestic LLCs are exempt from federal BOI reporting.
- Don't assume revenue under the threshold is permanent. The no-tax-due threshold is adjusted for inflation in even years — re-check it each filing cycle rather than assuming last year's number still applies.
6. How Otonomos helps
We handle formation and the registered agent requirement, and can coordinate your annual Franchise Tax Report filing so the May 15 deadline doesn't get missed even when there's no tax actually due. EIN, banking, nominee structures, and structuring guidance are available as add-ons, all tracked through the Otonomos Dashboard.
Frequently asked questions
Is it true Texas LLCs don't have to file an annual report?
Not quite. Texas doesn't charge a standalone annual report fee, but every LLC must still file a Public Information Report and Franchise Tax Report by May 15 each year — even when no tax is owed.
Do I owe Texas Franchise Tax if my revenue is low?
No tax is due if total revenue is under the no-tax-due threshold, US$2.65 million for the 2026 report. The filing itself, however, is still mandatory regardless of revenue.
Do I need to be a US resident to form a Texas LLC?
No. Non-US residents and non-citizens can own 100% of a Texas LLC.
Do I still need to file a Beneficial Ownership Information report?
No, as of FinCEN's August 2026 final rule, domestic LLCs are permanently exempt from BOI reporting under the Corporate Transparency Act.
What happens if I miss the May 15 Franchise Tax Report deadline?
Penalties and interest can apply, and continued non-compliance risks forfeiture of the LLC's right to transact business in Texas, with involuntary termination possible if left unresolved.
Related Reading
Sources: Texas Secretary of State, sos.state.tx.us; Texas Comptroller of Public Accounts, comptroller.texas.gov; FinCEN, fincen.gov (Beneficial Ownership Information Reporting Requirement Revision, August 2026); Otonomos pricing per otonomos.com/order/texas-llc. Verified September 2026.
Updated 11 days ago