Step 2: Business Tax Responsibilities
The second step for starting a business is to determine the federal, state, and local tax obligations. The following sections briefly discuss each of these areas. It is strongly recommended that a professional tax advisor, accountant, and/or attorney be consulted before starting a business.
Information regarding federal income taxes, tax identification numbers, business tax credits, and employment tax regulations may be obtained by contacting the following agencies:
- Income Taxes, Tax Identification Numbers, and Business Tax Credits
Internal Revenue Service
825 East Rundberg Lane, Suite H-4
Austin, Texas 78753
800/829-1040 or 800/829-4059 (TDD)
Business Tax Kit and other publications 800/829-3676 or 800/829-4059 (TDD)
- Employment Taxes
Social Security Administration
903 San Jacinto
Austin, Texas 78701
512/916-5404 or 800/772-1213
The Comptroller of Public Accounts is charged with the administration and collection of state and local sales tax from businesses operating in Texas, and also collects any franchise taxes owed by Texas corporations. There is no state income tax in Texas. The Comptroller maintains field offices in most major Texas cities to provide assistance and aid in complying with tax regulations. For further information on these taxes, contact:
Comptroller of Public Accounts
111 East 17th Street
Austin, Texas 78711
512/463-4600 or 800/252-5555
The permits required for taxes collected by the Comptroller are defined and outlined in the section titled Listing of Business Licenses and Permits.
The Texas Workforce Commission collects all unemployment taxes for workers employed in Texas. For information regarding these taxes, to obtain a state employer’s identification number, and for information on tax credits, contact:
Texas Workforce Commission
101 East 15th Street
Austin, Texas 78778
New Employer Accounts/Status of Accounts 512/463-2731 or 800/832-9394
Quarterly Reports 512/463-9182
Unemployment Insurance Customer Service 512/463-2542
Labor Market Information 512/491-4922
Work Opportunity Tax Credit (WOTC) 512/463-2488 or 800/695-6879
If the business owns tangible personal property that is used to produce income, the property must be reported on a rendition form to the local county appraisal district, after January 1 and no later than March 31, each year. Business owners must report all inventories, equipment, and machinery. For additional information, contact the local county appraisal district. See the government pages of your local telephone directory for telephone numbers.
Tax Reference Table
The following information pertains to state and federal taxes. The IRS Business Site assist businesses structured as Corporations, International Business, Partnerships and Small Businesses Self-Employed. The site has vital links to other Texas government entities. The IRS Employer ID Numbers (EINs) sites assist in obtaining an EIN. The site provides information on changing Ownership and information on EIN for Health Transactions. Businesses may need a National Standard Employer Identifier (NSE) for electronic health transactions. Further assistance on Texas tax can be viewed on the Texas State Comptroller website which includes information on electronic filing and online assistance through the STAR system.