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Tag: Texas tax 2025
Texas Gross Receipts Tax Myths (Hint: It’s the Franchise Tax)
Many founders and out-of-state business owners believe Texas has a gross-receipts tax. While technically false, this myth exists because the Texas Franchise Tax – also known as the margin tax – functions similarly by taxing total revenue with limited deductions. Let’s debunk this and explain what Texas actually taxes in 2025. Is There a Gross-Receipts […]
Texas Comptroller Audits: Top SaaS Margin-Tax Adjustments
Introduction Think Texas doesn’t audit tech startups? Think again. The Texas Comptroller is doubling down on Franchise Tax audits, especially for SaaS companies claiming aggressive cost of goods sold (COGS) or compensation deductions under the Margin Tax. If your business is software-based and relies on recurring revenue, here’s what to know about top adjustments made […]
Compensation Deduction Cap ($370K) for 2025
Texas Franchise Tax law allows a deduction for compensation paid to employees , but it’s capped. For 2025, the maximum deduction per person is $370,000. For founders and key employees, smart planning around this cap can reduce your Texas Franchise Tax without triggering IRS or state-level scrutiny. What Is the Compensation Deduction Cap? Under Texas […]
How Stripe Tax Handles Texas Local Sales Tax Rates
Stripe Tax helps businesses automate sales tax collection, but when selling to Texas customers, things get more complex. Texas not only imposes a 6.25% state sales tax, but also adds up to 2% in local sales tax. Does Stripe handle this for you? Here’s how Stripe Tax manages local rates and what Texas sellers need […]