Texas LLC Forfeiture Notice: What to Do When You Get One

A Texas LLC forfeiture notice means the state is telling you that your LLC has lost — or is about to lose — its legal right to operate in Texas. This typically happens when you miss franchise tax filings or the Public Information Report by the May 15 deadline. Do not ignore it. The longer you wait, the harder and more expensive the fix becomes, and your personal liability exposure grows with every day the entity stays forfeited.

Step 1: Understand what triggered the forfeiture

Texas forfeitures come from two separate agencies, and it matters which one sent the notice:

Texas Comptroller of Public Accounts issues forfeiture for:

• Failure to file the annual franchise tax report (due May 15)
• Failure to file the Public Information Report / PIR (Form 05-102, also due May 15)
• Failure to pay franchise taxes owed

Texas Secretary of State issues forfeiture for:

• Failure to maintain a registered agent (separate process — see Texas registered agent requirements)

Most LLC forfeiture notices come from the Comptroller. Look at the header of your letter — it will say either "Texas Comptroller of Public Accounts" or "Texas Secretary of State." The fix is different depending on the source.

This guide covers the more common Comptroller-triggered forfeiture. If your notice came from the SOS, the path is different and involves appointing a new registered agent.

Step 2: Check your current forfeiture status

Before doing anything else, confirm exactly where things stand:

1. Go to Texas Comptroller Franchise Tax Account Status
2. Enter your LLC's taxpayer number (the 11-digit number on your Comptroller notices) or your entity name
3. The result will show one of three statuses:
   • Good Standing — the forfeiture notice may have been issued in error, or you already resolved it
   • Delinquent — reports or taxes are overdue, but forfeiture has not yet taken effect
   • Forfeited — forfeiture is complete; you must reinstate

If your status shows Delinquent, you have a window to file and pay before forfeiture is finalized. Move immediately to Step 3.

If your status shows Forfeited, your LLC has already lost its operating rights. You will need to complete all of Steps 3–5 to reinstate.

Common mistake: Many LLC owners see a forfeiture notice and assume the entity is already dead. Often, the notice is a warning sent before forfeiture occurs. Check the status first — you may still be in the delinquent stage where the fix is simpler.

Step 3: File all missing franchise tax reports and the PIR

The Comptroller will not reinstate your entity until all missing filings are submitted. You need to file a franchise tax report for every year you missed.

1. Go to WebFile at comptroller.texas.gov/taxes/franchise/
2. Log in with your Texas taxpayer ID (or create an account if you haven't used WebFile before)
3. File a separate report for each year you are delinquent. You cannot file a single catch-up report — you must submit one per reporting period
4. For each year, choose the correct form:
   • Form 05-169 (EZ Computation) if annualized revenue was ≤ $20 million that year
   • Forms 05-158-A and 05-158-B (Long Form) if revenue exceeded $20 million
5. For each year, also file the Public Information Report (Form 05-102) alongside the franchise tax report. Missing the PIR is a separate violation that can independently trigger forfeiture
6. If your LLC had $0 in revenue and owes $0 in tax for a given year, you still must file the report and PIR to clear the delinquency

This process takes approximately 15–30 minutes per year of delinquency. For the filing walkthrough, see how to file the Texas franchise tax report.

Step 4: Pay all back taxes, penalties, and interest

Once you've filed all missing reports, your Comptroller account will show the total amount owed. This typically includes:

• Back franchise taxes — based on revenue reported in the late filings
• $50 late-filing fee per delinquent report
• 5% penalty if each report was filed 1–30 days late; 10% if more than 30 days late (see Texas franchise tax penalty guide for details)
• Interest — begins accruing 61 days after each original due date

Pay online through WebFile using electronic check (ACH) or credit card. If the total balance is significant and you cannot pay it all at once, contact the Comptroller's taxpayer services at 800-252-1381 to discuss a payment arrangement before assuming you are stuck.

Important: The Comptroller will not issue a Certificate of Account Status — which you need for SOS reinstatement — until the balance reaches $0. Partial payment does not clear the account.

Step 5: Request a Certificate of Account Status

After all filings are submitted and the balance is paid in full:

1. Return to mycpa.cpa.state.tx.us/coa/
2. Your status should now show Good Standing
3. Print or download the Certificate of Account Status — this document proves you are current with the Comptroller
4. Keep the certificate handy; you may need it to reopen bank accounts, sign contracts, or satisfy other third parties that your entity is back in good standing

The Certificate of Account Status updates in real time once your account is cleared. In most cases, you will not need to file separately with the SOS after a Comptroller-only forfeiture — the Comptroller's status is what matters for most practical purposes.

If your entity was forfeited by the SOS (not just the Comptroller): you will additionally need to file a Certificate of Reinstatement with the Secretary of State. See how to reinstate a forfeited Texas LLC for that process, including the SOS fees and form requirements.

Step 6: Prevent this from happening again

Once your LLC is back in good standing, put systems in place so you never receive another forfeiture notice:

• Set a recurring May 1 calendar reminder (two weeks before the May 15 deadline) to gather the prior year's financials and file both the franchise tax report and the PIR
• Create a WebFile account if you haven't already — online filing is faster, confirms receipt immediately, and keeps your filing history in one place
• Keep your registered agent address current — the Comptroller sends notices to your registered agent's address. If that address is wrong, you may not receive warnings until after forfeiture occurs

Ortholo's compliance checker also tracks your Texas deadlines and can send you email reminders before they come due.

Quick reference

Frequently asked questions

What does a Texas LLC forfeiture notice mean?

A forfeiture notice from the Texas Comptroller means your LLC has lost — or is about to lose — its right to transact business in Texas due to unfiled or unpaid franchise tax obligations. Once forfeited, officers and directors can become personally liable for the LLC's debts under Texas Tax Code § 171.255. Act immediately to prevent or reverse forfeiture.

How long do I have to respond to a Texas LLC forfeiture notice?

The Comptroller typically issues a Notice of Intent to Forfeit before the forfeiture takes effect. If you act within approximately 30 days of that notice, you may be able to file and pay before your status changes to Forfeited. If forfeiture has already occurred, you must still file and pay all missing amounts to get reinstated — but the sooner you act, the less interest accumulates.

What happens to my contracts and bank accounts if my Texas LLC is forfeited?

Forfeiture does not automatically void contracts already in place, but your LLC cannot legally enter new contracts or sue to enforce them in Texas courts. Officers and directors also become personally liable for debts incurred after the forfeiture date. Banks that learn of forfeiture may freeze or close business accounts. Reinstate your LLC as quickly as possible to restore full legal standing.

How much does it cost to fix a Texas LLC forfeiture?

The minimum cost is $50 per missed year (the late-filing penalty, assuming $0 tax owed). If your LLC has tax liability, add 5–10% of the amount owed per year plus interest. There is no separate SOS reinstatement fee for a Comptroller-only forfeiture — once your Comptroller account is cleared, your entity is reinstated. If the SOS also issued a forfeiture, additional reinstatement fees apply.

Can I still use my LLC name after forfeiture?

Your LLC name is not immediately available to others when your entity is forfeited, but it can become vulnerable if the entity is subsequently terminated or administratively dissolved. Filing for reinstatement promptly protects your name. Once reinstated, your name rights are restored as if the forfeiture never occurred.

Not sure what else your Texas LLC owes?

Most business owners are surprised by how many filing obligations they have. Ortholo's free compliance checker shows you everything you owe, when it's due, and what happens if you miss it — personalized to your entity.

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Last verified: 2026-05-01

Sources: Texas Comptroller — Franchise Tax · Texas Comptroller Account Status · Texas Tax Code §§ 171.251–171.255