How to Form a Corporation in Texas

What you file in Texas

This page covers the state filing and the charges that follow it. For the procedural side (name availability, registered agent, bylaws and the federal EIN), see the formation guide and how to get an EIN, both of which apply to corporations as well as LLCs.

What it costs to incorporate and stay filed

State filing charges only. Corporate income tax and franchise tax are excluded. Both depend on income or net worth, so no flat figure would be true for every corporation.

Texas has the highest incorporation filing fee of the 49 states ranked. Nationally the fee runs from $35 in Montana to $300 in Texas, averaging $113.49. It is a one-off charge, so over five years it is usually outweighed by the recurring report fee and any annual franchise or minimum tax.

States that are cheaper to incorporate in

A cheaper filing fee elsewhere rarely saves money if you actually operate in Texas. Every state sets its own threshold for what counts as transacting business, and where that threshold is met an out-of-state corporation is generally required to register as a foreign corporation. Which would mean fees in both states rather than one. Whether it applies to you depends on facts this page cannot see, so check foreign qualification in Texas before incorporating elsewhere to save on the filing fee.

Texas corporation vs Texas LLC

State filing charges only. Corporate income tax and franchise tax are excluded because both depend on income or net worth, so no flat figure exists for either entity.

Both entities cost $300 to file in Texas, so the filing fee is not a reason to pick one over the other.

Full Texas LLC cost breakdown · LLC vs C-corp explained · LLC vs S-corp explained

State taxes a Texas corporation pays

Franchise or gross-receipts tax

Texas imposes a franchise (margin) tax on taxable entities in lieu of a corporate income tax. No-tax-due threshold, measured on annualized total revenue: $2,470,000 for report years 2024 and 2025 and $2,650,000 for report years 2026 and 2027 (a corporation at or below the threshold owes no tax but must still file a Public Information Report). Rates: 0.375% for entities primarily engaged in retail or wholesale trade, 0.75% for all other taxable entities; the optional EZ computation rate is 0.331% (available up to $20M annualized revenue). The franchise tax applies regardless of a federal S-corporation election.

What these totals leave out: the filing-charge figures on this page are what you pay the business filing office. They exclude corporate income tax and any franchise or gross-receipts tax, because both depend on income, net worth or receipts. The section above sets out what Texas levies, or that it levies neither. Where a state's franchise tax carries a flat minimum, that minimum is an unavoidable annual cost these totals do not include, and over five years it can be the larger number.

C-corp return: No corporate income tax return exists. A corporation (C corp or S corp) whose annualized total revenue is above the no-tax-due threshold files the annual Texas Franchise Tax Report, Long Form (Form 05-158-A/05-158-B) or EZ Computation Report (Form 05-169), plus the Public Information Report (Form 05-102), with the Comptroller. A corporation at or under the threshold files only the Public Information Report.

Electing S-corporation status in Texas

Texas has no corporate income tax, so there is no state S election to make. Full Texas S-corporation election guide.

Where these numbers come from