How to Find State Specific Franchise Laws for Texas

Franchises are the offspring of pre-existing businesses. While you own the franchise business, you license the use of the existing company's legal intellectual property. Each state has enacted its own laws governing such business ventures, which you will be held to as a franchisee. For this reason it is important to review the state specific franchise laws of Texas.

Instructions

1. Visit the Texas Comptroller of Public Accounts website (see Resources below). You may also try the Texas Business Portal or the Texas Secretary of State's website, but both will ultimately lead you to the comptroller.

2. Review the general Texas franchise tax tips at the Texas Comptroller of Public Accounts site. You will find that your first franchise tax forms are due 1 year and 89 days from the time you begin your franchise operation.

3. Read the tip that points out that even non-corporations may be subject to franchise taxation.

4. Take advantage of the "Franchise Tax Calculator" link provided at the site.

5. Call the Texas Comptroller's toll free franchise hotline, [phone], to get answers to specific questions.

6. Write to the Comptroller of Pubic Accounts for help understanding Texas franchise laws. The address is 111 E. 17th Street, Austin, TX 78774.

7. Know that Texas franchise laws primarily affect your tax obligation to the state of Texas. For this reason, you would be wise to consult an attorney who specializes in Texas franchise tax law. These specially trained attorneys can help you set up your business to your best tax advantage, so that you are not faced with tax surprises.

8. Realize Texas is not a state that requires franchisers to furnish a Uniform Franchise Offering Circular to franchisees before the Franchise Agreement. That doesn't mean, however, that you should not request one. The information in the UFOC is meant to disclose vital information about the franchise. Visit the North American Securities Administrators Association website to see the requirements for UFOCs (see Resources below).

Tips & Warnings

• Texas specific franchise tax laws will apply to your franchise even if the business you are a franchisee of is not located in Texas itself. If you do business in Texas, you are subject to Texas franchise tax laws.

• By careful research you should be able to gather a working knowledge of Texas franchise laws in few days.

• Failure to properly understand and file franchise tax forms with the state of Texas can result in severe tax penalties which could endanger the profitability of your business.