Series LLCs in Texas
Texas Series LLCs allow asset segregation into “series” under a master LLC, simplifying formations and liability shields. A common question is whether each series must file its own Texas franchise-tax report or if the master LLC can file just one consolidated return.
Relevant Tax & Code References
- Texas Tax Code §171.101 defines “taxable entity” for franchise-tax purposes.
- Texas Tax Code §171.001(7) treats an LLC as a “taxable entity.”
- Comptroller Private Letter Ruling 201005184L concluded that each series of a Series LLC is aggregated and treated as a single taxable entity for franchise tax purposes (Digital Commons).
- By analogy, IRC §1502 permits affiliated U.S. corporations to file a consolidated return; Texas similarly aggregates series under one master LLC rather than separate state filings.
Relevant Forms & Filings
- Form 05-158 (Franchise Tax Report and Payment) – filed by the master LLC, checking the appropriate computation method.
- Form 05-102 (Public Information Report) – also filed by the master LLC, listing all series as “doing business as” names, if required.
- Certificate of Account Status (Form 05-230) – requested after payment to confirm zero balance for annual compliance.
Detailed Example
Acme Master LLC creates two registered series—Series A for rental properties and Series B for equipment leasing. Each series maintains separate books and bank accounts. For Texas franchise tax:
- Combined Revenue: Series A $500,000 + Series B $300,000 = $800,000 total revenue
- Margin Calculation (total revenue minus $1 million threshold or 70%): using 70% method → $800,000 × 70% = $560,000 taxable margin
- Franchise Tax Due: $560,000 × 0.375% = $2,100
Acme Master LLC files one Form 05-158, reporting combined figures for all series (Lone Star Land Law, The Balance Sheet HNIs live by).
Step-by-Step Guide
- Maintain Separate Records
- Each series must track its own assets, liabilities, revenues, and expenses.
- Aggregate Revenues & Deductions
- Sum revenue and choose one margin method (e.g., 70% of total revenue or revenue minus COGS).
- Access WebFile
- Log in at comptroller.texas.gov/e-file/webfile/.
- Complete Form 05-158
- Enter the master LLC’s EIN.
- Report the combined revenue, deductions, and margin.
- Check “EZ Computation” or “No Tax Due” if applicable.
- File Public Information Report
- On Form 05-102, list each series as an “Assumed Name” if doing business under a trade name.
- Pay Tax & Request Status
- Remit via ACH (no fee) or credit card (convenience fee).
- After payment, submit Form 05-230 to obtain a Certificate of Account Status.
Conclusion
For Texas Series LLCs, all protected or registered series aggregate under the master LLC and file one franchise-tax report—streamlining compliance while preserving the liability protections of individual series.
Schedule a Consultation
Clarify your Series LLC tax strategy—schedule a meeting with our CPA, Anshul Goyal:
https://calendly.com/anshulcpa/
Disclaimer
This post offers general guidance on Texas Series LLC franchise-tax reporting and does not constitute legal or accounting advice. Always verify current requirements with the Texas Comptroller. For tailored assistance, consult Anshul Goyal, CPA EA FCA—a licensed CPA in the United States and Enrolled Agent before the IRS—who specializes in multi-series entity compliance and state tax strategies.
About Our CPA
Anshul Goyal, CPA EA FCA, brings over 12 years of experience in entity structuring and state tax compliance. He advises Series LLCs, multi-entity groups, and international clients on streamlined filings and audit readiness.
Top 5 FAQs
1. Does each series need its own EIN for Texas tax?
Only the master LLC’s EIN is used for franchise-tax reporting; series show up as “doing business as” names.
2. Can I choose separate margin methods per series?
No—Texas requires one calculation method applied to the aggregated revenues and deductions.
3. What if a series has zero revenue?
It still contributes to the aggregate total; a single “No Tax Due” EZ report may apply if combined revenues fall below the threshold.
4. How do I list series on the Public Information Report?
Use Form 05-102 to list each series as an assumed name or registered DBA.
5. Are there extra fees per series?
No additional franchise-tax fees or filings per series—only one fee and return for the master LLC.