How to Dissolve an LLC in Texas — 2026 Filing Guide

Required?

Yes

Who can serve

Your Texas registered agent must remain active until the Texas SOS accepts the Certificate of Termination (Form 651). Texas BOC § 5.201 requires a registered agent at all times while the LLC is active — including during the winding-up period.

Can I serve myself?

Yes

Commercial RA cost

~$100/yr

Cancel your commercial RA subscription immediately after the SOS confirms acceptance of the Certificate of Termination. RA services do not auto-cancel on dissolution — get written confirmation of cancellation from your RA provider to stop billing.

Renewing or switching? Compare standalone registered agent services — Northwest, Harbor Compliance, Registered Agents Inc., InCorp, and more.

1. Hold a member or manager vote to dissolve per your company agreement or BOC § 11.101 Convene a meeting of the LLC's governing authority and vote on dissolution. Texas BOC § 11.101 requires approval by the number of owners specified in the certificate of formation or company agreement. If those documents are silent, a majority vote of the LLC's governing authority (managers in a manager-managed LLC; members in a member-managed LLC) is required. Document the vote in a signed written resolution or unanimous written consent. Keep this document in the LLC's permanent records — it is required to certify compliance on Form 651.
2. File the final franchise tax wind-up report with the Texas Comptroller File the final franchise tax report through the Texas Comptroller's eSystems portal at comptroller.texas.gov. The final report covers the LLC's last active period (from the start of the privilege period through the termination date). Most small Texas LLCs will file a No-Tax-Due report (gross receipts below the $2.47 million threshold for 2026). LLCs above the threshold owe franchise tax at 0.375% (retail/wholesale) or 0.75% (other businesses) of taxable margin. Check the 'Final Report' box on the Comptroller's filing to signal that no further returns are expected. Processing typically takes 1–5 business days after online submission.
3. Obtain a Certificate of Account Status (Form 05-359) from the Comptroller After the Comptroller accepts the final franchise tax report, request a Certificate of Account Status (Form 05-359) through eSystems at comptroller.texas.gov. This certificate confirms the LLC has no outstanding franchise tax obligations and is in good standing with the Comptroller. It is a required attachment to the Certificate of Termination — the Texas SOS will not accept Form 651 without it. Processing is typically 1–5 business days after the final report is accepted. The certificate is free to obtain and is valid for 45 days from the issue date.
4. Wind up the LLC's affairs: notify creditors, liquidate assets, pay debts Under Texas BOC §§ 11.051–11.059, winding up an LLC requires: (1) Sending written notice of dissolution to all known creditors, providing a reasonable claim period (60–90 days recommended). (2) Collecting all outstanding receivables owed to the LLC. (3) Paying or making adequate provision for all known debts, liabilities, and obligations — vendor invoices, lease obligations, employee wages, and legal claims. (4) Liquidating remaining LLC assets (selling equipment, IP, inventory). (5) Distributing remaining funds to members in proportion to their membership interests as specified in the company agreement or BOC defaults. Document every step — improper distributions to members while creditors are unpaid can expose members to personal liability.
5. File the Certificate of Termination (Form 651) with the Texas SOS File Form 651 (Certificate of Termination) through SOSDirect at direct.sos.state.tx.us or by mail to the Texas Secretary of State, P.O. Box 13697, Austin, TX 78711. Filing fee: $40. Attach the Comptroller Certificate of Account Status (Form 05-359). The form requires: LLC legal name, date of member/manager vote authorizing termination, certification that winding-up has been completed and all debts have been paid or adequately provided for, and signature of an authorized person. Standard processing: 2–3 business days online. Same-day expediting available for +$25 if submitted through SOSDirect by 11:00 AM CST.
6. File the final federal return and cancel the EIN with the IRS File the LLC's final federal return: Form 1065 (multi-member LLC taxed as partnership) or Schedule C on Form 1040 (single-member disregarded entity). Check the 'final return' box. For S-corp elections, file Form 1120-S and Form 966 (Corporate Dissolution) within 30 days of the dissolution vote. After the final return is filed and all balances are paid, cancel the EIN by sending a letter to the IRS (Cincinnati, OH 45999) requesting EIN closure. Include LLC legal name, EIN, reason (business dissolved), and mailing address. EIN cancellation is free; allow 60–90 days for IRS confirmation.
7. Cancel registered agent service and foreign qualifications in other states Cancel your Texas registered agent subscription immediately after the SOS confirms the Certificate of Termination is accepted. For each state where the Texas LLC was foreign-qualified, file a Certificate of Withdrawal in that state separately — Texas termination does not automatically withdraw foreign qualifications. Cancel any state or local business licenses, permits, or DBA registrations. Close the LLC's business bank accounts after all checks have cleared and final member distributions are complete.

Texas Business Organizations Code (BOC) § 11.101 (dissolution vote); BOC § 11.001 (definitions); BOC §§ 11.051–11.059 (winding up procedures); BOC § 11.152 (Certificate of Termination); Texas Tax Code §§ 171.001–171.1532 (franchise tax); Texas Comptroller Rule § 3.559 (tax clearance for termination); 26 U.S.C. § 6109 (EIN obligations).

Direct filing portal: https://direct.sos.state.tx.us/

Formation context

Who should form in Texas?

Recommended for

Texas LLC owners winding down an active or inactive business who want to stop franchise tax filing obligations permanently; Members of manager-managed Texas LLCs who have voted to terminate under BOC § 11.101; Texas LLC owners whose LLCs have been automatically forfeited by the Comptroller and who need to restore good standing before filing termination; Business owners dissolving a Texas LLC that was used as an operating entity while keeping a Texas holding LLC or Series LLC active

Tax treatment (default)

Texas has no state income tax on LLC members' pass-through income — dissolution does not trigger a Texas personal income tax event for members. The only Texas tax obligation on dissolution is the final franchise tax report and any franchise tax owed. Federal: final Form 1065 or Schedule C, with liquidating distributions treated as sale or exchange of membership interest. Consult a CPA on the federal tax consequences of LLC liquidation, especially if the LLC has appreciated assets or real property.

If the Texas LLC was foreign-qualified in other states (California, New York, Florida, etc.), Texas termination does NOT automatically withdraw those foreign qualifications. File an Application for Withdrawal in each foreign-qualified state separately — annual report obligations in those states continue until formal withdrawal. Start with states that have the longest processing times (California, New York) first.

No publication requirement in Texas — unlike New York or Nebraska, you do not need to publish notice in a newspaper after filing.

FAQ

Common Texas LLC formation questions

Still deciding between an LLC, sole proprietorship, S-Corp, or C-Corp? Our entity-type comparison breaks down formation cost, tax treatment, liability shield, and compliance complexity for all four structures side by side.

Once your LLC clears ~$80K in annual net profit, an S-Corp election (IRS Form 2553) typically saves $5,000–$15,000/year in self-employment taxes by splitting owner income into a W-2 salary + tax-free distributions. The election is free — Form 2553 has no IRS filing fee. The key decision factors: your net income level, a defensible reasonable-compensation salary, and the 75-day Form 2553 filing window after LLC formation.

Already operating as a sole proprietor, or wondering whether a cheap county DBA filing ($10–$100) is enough instead of forming an LLC? A DBA lets you operate under a trade name — but provides zero liability protection. Our DBA vs LLC comparison breaks down exactly when a DBA is sufficient and when you need a state LLC filing.

Missing your annual report deadline triggers late fees and — if left long enough — administrative dissolution, which voids your LLC's liability shield until reinstated. Know your Texas deadline, fee, and the consequences of missing it.

Also see the LLC annual report requirements hub for state-by-state deadlines, fees, late penalties, and reinstatement rules.

If your LLC opens an office, hires employees, or regularly does business in another state, you must foreign-qualify there — or face fines, back taxes, and loss of standing to sue. Our foreign qualification guide covers when you need it, how to file a Certificate of Authority, and what it costs.

Your Articles of Organization are filed — now make your LLC operational. Four actions every new LLC owner needs to take:

Formation gets your LLC into existence; contracts, trademark protection, operating agreement review, and vendor-document review keep it usable. Compare subscription and per-document legal platforms before you rely on a template or pay a local attorney retainer.

Commingling personal and business funds is the #1 way LLC owners lose their liability shield. A separate business account — in your LLC's legal name, with your EIN — is the foundational act of corporate formality. Mercury, Novo, Bluevine, Relay, and Found open same-day with no monthly fees. Compare online banks vs. Chase and Bank of America.

How you pay yourself depends on your LLC's tax classification — not what you call the transfer. A disregarded single-member LLC pays via owner draw with SE tax on all net profit. An S-Corp-elected LLC splits income between a W-2 salary (FICA applies) and tax-free distributions. Getting this wrong triggers IRS audit risk and SE-tax errors.

Single-member LLCs file Schedule C with their personal Form 1040 (due April 15). Multi-member LLCs file Form 1065 by March 15. S-Corp-elected LLCs file Form 1120-S by March 15. Know your form, your deadline, and the common deductions — home office, vehicle, retirement contributions, and startup costs — before your first April filing.