Texas and Florida are both popular, tax-friendly states to form an LLC — neither charges personal income tax — but they differ on formation cost, annual filings, and how the state collects its revenue. Texas costs $300 to form and requires a franchise tax report every May 15; Florida costs $125 to form and requires a flat $138.75 annual report every May 1. Here is exactly how the two compare so you can choose where to form.
Step 1: Compare the cost to form the LLC
The up-front cost is the first place these two states diverge.
Texas — Certificate of Formation (Form 205):
- File with the Texas Secretary of State at sos.state.tx.us
- Filing fee: $300
- Requires: entity name, registered agent name and address, and the organizer's signature
- Processing time: typically 2–3 business days online
Florida — Articles of Organization:
- File with the Florida Division of Corporations (Sunbiz) at dos.myflorida.com/sunbiz
- Filing fee: $125 ($100 filing fee + a $25 registered agent designation fee)
- Requires: entity name, principal address, and registered agent name and address
- Processing time: typically a few business days online
Common mistake: Many new owners assume the cheaper formation state is automatically the better choice. Formation is a one-time cost — the recurring annual obligations matter far more over the life of the business. See our Texas LLC cost breakdown for the full picture of Texas fees.
Both states require a registered agent — a person or company with a physical street address in that state who accepts legal notices and official mail on the LLC's behalf.
Step 2: Compare the annual filing in each state
This is the biggest ongoing difference between the two states.
Texas — Franchise Tax Report + Public Information Report, due May 15:
Every Texas LLC must file a franchise tax report with the Texas Comptroller of Public Accounts by May 15 each year, even if it owes no tax.
- No-tax-due threshold (2026): $2,650,000 in annualized total revenue. Below this, you owe $0 in tax — but you must still file.
- Tax rates if above the threshold: 0.375% (retail and wholesale) or 0.75% (all other businesses)
- Filing fee: $0 — the franchise tax report and the Public Information Report (Form 05-102) are both free to file
- Forms: EZ Computation (05-169) if revenue is $20M or less; Long Form (05-158-A/B) otherwise
- How to file: Online via WebFile at comptroller.texas.gov or by mail
Common mistake: Owners assume "no tax due" means "no filing required." Wrong. Every active Texas LLC must file the report regardless of revenue. For a step-by-step walkthrough, see our how to file Texas franchise tax guide.
Florida — Annual Report, due May 1:
Every Florida LLC must file an annual report with the Florida Division of Corporations by May 1 each year.
- Filing fee: a flat $138.75 — the same amount regardless of revenue or size
- What it does: confirms or updates the LLC's addresses, registered agent, and managers/members
- How to file: Online at dos.myflorida.com/sunbiz
- No revenue threshold and no franchise tax — Florida does not impose a franchise tax on LLCs
The practical difference: a small Texas LLC below the threshold pays $0 each year but must complete the franchise tax and PIR paperwork, while a Florida LLC pays a flat $138.75 each year for a simpler one-page report.
Step 3: Compare the state tax treatment
Neither Texas nor Florida charges a personal income tax, so pass-through LLC owners in both states avoid state-level tax on their share of business income. The difference is in how each state taxes the entity itself.
| Tax | Texas LLC | Florida LLC |
|---|---|---|
| State personal income tax | None | None |
| Franchise / entity-level tax | Franchise tax (most small LLCs owe $0) | None on LLCs |
| Corporate income tax | None | 5.5% — only if the LLC elects to be taxed as a C-corporation |
| Sales tax (state rate) | 6.25% (up to 8.25% with local) | 6% (plus local surtax) |
Key point: A default pass-through LLC (single-member or partnership) generally does not pay Florida's corporate income tax — that 5.5% rate applies to entities taxed as C-corporations. In Texas, the franchise tax applies to the entity regardless of federal tax election, but stays at $0 below the no-tax-due threshold. Neither state's rules replace your federal income tax obligations. This is general information, not tax advice — confirm your situation with a licensed CPA.
Step 4: Compare the penalties for missing a deadline
Both states penalize late filers, but the mechanics differ.
Texas late penalties:
- $50 late fee immediately for a late franchise tax report
- Plus 5% of any tax owed if filed within 30 days, or 10% if more than 30 days late
- Interest begins 61 days after the due date
- Continued non-filing leads to forfeiture of the LLC's right to transact business in Texas, and officers/managers can become personally liable for entity debts under Texas Tax Code §§ 171.251–171.255
Florida late penalties:
- A flat $400 late fee added to the $138.75 report if filed after May 1 (this fee is not prorated and not waivable for a standard LLC)
- Continued non-filing leads to administrative dissolution of the LLC, typically on the fourth Friday of September
Common mistake: Florida's $400 late fee is often larger than the report itself and cannot be waived — set a calendar reminder well before May 1. If you have already missed a Texas deadline, see our Texas franchise tax penalty guide.
Step 5: Decide which state fits your business
Choose based on where you actually operate, not on a small difference in fees.
Form in Texas if:
- You live in or primarily do business in Texas
- You want a franchise tax obligation that is $0 for most small businesses (paperwork required, but no fee)
- You have Texas nexus — customers, employees, or a physical presence in the state
Form in Florida if:
- You live in or primarily do business in Florida
- You prefer a simple, predictable flat annual fee over a revenue-based tax calculation
- You have Florida nexus
If you operate in both states: Form the LLC in your home state and register as a foreign LLC in the other. Forming in a state where you have no real presence usually just doubles your filing obligations without a benefit. If you already have an out-of-state LLC and are expanding into Texas, see our register an out-of-state LLC in Texas guide.
Estimated annual compliance time:
- Texas LLC (below threshold): ~1–2 hours/year around the May 15 franchise tax and PIR deadline
- Florida LLC: ~30 minutes/year to file the annual report before May 1
Quick reference
| Detail | Texas LLC | Florida LLC |
|---|---|---|
| Formation document | Certificate of Formation (Form 205) | Articles of Organization |
| Formation fee | $300 | $125 |
| Filing agency | Texas Secretary of State | Florida Division of Corporations |
| Annual filing | Franchise tax report + PIR (Form 05-102) | Annual report |
| Annual filing fee | $0 (most small LLCs owe $0 tax) | $138.75 flat |
| Annual due date | May 15 | May 1 |
| Franchise tax | Yes — $0 below $2,650,000 (2026) revenue | None on LLCs |
| State personal income tax | None | None |
| Late penalty | $50 + 5–10% on tax owed | $400 flat late fee |
| Non-filing consequence | Forfeiture of right to do business | Administrative dissolution |
| Registered agent required | Yes — physical TX address | Yes — physical FL address |
FAQ
Is it cheaper to form an LLC in Texas or Florida?
Florida is cheaper up front. Florida charges $125 to file the Articles of Organization ($100 filing fee plus a $25 registered agent designation fee), while Texas charges $300 for the Certificate of Formation (Form 205). Florida's recurring cost is a flat $138.75 annual report, while a small Texas LLC typically owes $0 in franchise tax but must still file the report. Verify current fees with each state before filing.
Does a Texas LLC pay franchise tax and a Florida LLC does not?
Yes. Every Texas LLC must file a franchise tax report with the Texas Comptroller by May 15 each year, though most small LLCs owe $0 because the 2026 no-tax-due threshold is $2,650,000 in annualized total revenue. Florida imposes no franchise tax on LLCs — instead, a Florida LLC files a flat $138.75 annual report by May 1. Neither state charges a personal income tax.
What is the deadline for the annual filing in each state?
A Texas LLC's franchise tax report and Public Information Report are both due May 15 each year. A Florida LLC's annual report is due May 1 each year. Both deadlines carry penalties for late filing: Texas adds a $50 late fee plus 5–10% on any tax owed, and Florida adds a flat $400 late fee to the $138.75 report.
Should I form my LLC in Texas or Florida if I do business in both?
Form your LLC in the state where you actually operate, then register as a foreign LLC in the other. Forming in one state does not exempt you from the other state's requirements if you have nexus there. Filing in a state where you have no real presence usually just doubles your compliance work. Consult a licensed attorney or CPA for your specific situation.
What happens if I miss the annual filing in Texas or Florida?
In Texas, missing the franchise tax and PIR deadline brings a $50 penalty, 5–10% on any tax owed, and eventually forfeiture of your right to transact business in Texas. In Florida, missing the May 1 annual report adds a flat $400 late fee, and continued non-filing leads to administrative dissolution of the LLC, typically in late September.
Disclaimer: This page is for general informational purposes only and does not constitute legal or tax advice. Requirements, fees, and thresholds change — verify current requirements with the Texas Secretary of State, the Texas Comptroller, the Florida Division of Corporations, and a licensed attorney or CPA before acting.
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.
Last verified: 2026-08-04
Sources: Texas Comptroller — Franchise Tax | Texas Secretary of State — Business Organizations | Florida Division of Corporations (Sunbiz) | Florida Department of Revenue — Corporate Income Tax