News and Insights

Texas Franchise Tax Statute of Limitations Extended by First Request

Tax Development Nov 29, 2016

Texas franchise tax is due on May 15. A taxpayer required to pay franchise tax electronically (“EFT taxpayer”) may extend the due date to August 15 by filing an extension request by May 15 and paying the appropriate amount of tax. The August 15 due date can be extended to November 15 by filing a second extension request by August 15 and paying any additional tax due. 

In May 2009, an EFT taxpayer filed an extension and paid the appropriate amount of tax. The taxpayer did not remit the additional tax due by August 15. Instead, the taxpayer reported and paid the additional tax due in November. On May 23, 2013, the taxpayer requested a refund of franchise tax paid in 2009.

Comptroller staff denied the refund claiming that the first extension was not valid because the taxpayer failed to pay the balance of its 2009 franchise tax with its second extension request. The taxpayer requested an administrative hearing.

In finding for the taxpayer, the administrative law judge, in Comptroller Hearing Number 111,470, explained that filing a second request to extend the due date to November 15 is not a prerequisite to the first due-date extension. Because the taxpayer met the prerequisites to secure the first extension, the 2009 due date was August 17, 2009 (August 15 was a Saturday), and the taxpayer’s May 23, 2013 refund claim was timely.


Adina Christian