Texas Veteran Owned Business Certification
A qualifying new veteran-owned business is not subject to franchise tax for its initial five-year period, but must file Form 05-163, Texas Franchise Tax No Tax Due Report (PDF), for each of those years. For more information, see Texas Tax Code Section 171.0005 and Rule 3.574, Margin: New Veteran-Owned Businesses.
To be considered a new veteran-owned business, an entity must:
- be an entity formed or organized in Texas on or after Jan. 1, 2016, and before Jan. 1, 2020;
- be 100 percent owned by a natural person or persons with each owner being an honorably discharged veteran from a branch of the U. S. Armed Services; and
- provide a Texas Veterans Commission (TVC) issued Letter of Verification of Veteran’s Honorable Discharge for each owner.
The Comptroller’s office verifies this information. If during the initial five-year period, a new veteran-owned business no longer meets the above criteria, the business:
- must notify the Comptroller’s office; and
- becomes subject to franchise tax
Verification Process for a New Veteran-Owned Business
For your new veteran-owned business to qualify for the five-year franchise tax exemption, you must complete three steps. Here are the steps to follow:
Step 1 – Request a Letter of Verification of Veteran’s Honorable Discharge from the Texas Veteran’s Commission (TVC):
To receive a Letter of Verification of Veteran’s Honorable Discharge (which will include a unique alpha-numeric identification code), each veteran-owner must email a request, along with their Department of Defense Form 214 (DD214), to the TVC at sb1049@tvc.texas.gov. Please block out the Social Security number on the DD214 before emailing.
Each emailed request must include:
- the date of the request
- the veteran’s:
- first name, middle initial, last name;
- mailing address;
- city, state, ZIP code;
- telephone number;
- the following statement: “In accordance with the verification provision of Senate Bill 1049 I am hereby requesting verification of my status as a Veteran of the United States Military.”
- the veteran’s signature
Step 2 – Complete Comptroller Form 05-904:
Once all owners have received their Letter of Verification of Veteran’s Honorable Discharge from the TVC, complete Comptroller Form 05-904, Certification of New Veteran-Owned Business (PDF).
You must enter each owner’s:
- name
- unique identification code from their Letter of Verification of Veteran’s Honorable Discharge
- percentage of ownership in the business
- signature.
Use as many pages as necessary to identify 100 percent ownership in the business.
Step 3 – Submit Required Formation/Registration and Verification Documents:
A veteran-owned business must either form with the Secretary of State (SOS) or register with the Comptroller’s office. Please use the instructions below to complete Step 3.
QUALIFYING ENTITIES FORMING OR PREVIOUSLY FORMED WITH THE SECRETARY OF STATE
If you formed, or are forming, a new veteran-owned business as a corporation, limited liability company, limited partnership, limited liability partnership or professional association, you must file these documents with the SOS:
- a Letter of Verification of Veteran’s Honorable Discharge for each owner of the business;
- Form 05-904, Certification of New Veteran-Owned Business (PDF); and
- the SOS formation documents. (The formation documents are not required if your entity is already formed with the SOS.)
Documents may be sent to:
Secretary of StateP.O. Box 13697
Austin, TX 78711-3697
Contact the SOS at 512-463-5555 for filing assistance.
ENTITIES NOT REQUIRED TO BE FORMED WITH THE SECRETARY OF STATE
If you formed, or are forming, a new veteran-owned business as any other entity type that is subject to franchise tax, you must file these documents with the Comptroller’s office:
- a Letter of Verification of Veteran’s Honorable Discharge for each owner of the business;
- Form 05-904, Certification of New Veteran-Owned Business (PDF); and
- Form AP-224, Texas Business Questionnaire (PDF). (This questionnaire is not required if your entity is already registered with the Comptroller’s office.)
Documents may be sent to:
Comptroller of Public AccountsP.O. Box 149348
Austin, TX 78714-9348
Contact the Comptroller’s office at 512-463-4402 for assistance.
Come join NOW over 35,000 VOB Members. Add your business to the Veteran Owned Business Directory and grab one of our Verified Veteran Owned Business or Certified Veteran Owned Business badges for your website!
The above state certification information was brought to you by Veteran Owned Business. Veteran Owned Business is in no way affiliated with the above organization(s). We do not in any way endorse the above business/organization or guarantee the above news/press release. The Veteran Owned Business Project is simply providing information we feel is of interest to veterans, active duty military, reservists, service disabled veterans, veteran owned businesses, service disabled veteran owned businesses, families of veterans, families of our armed forces and any other person or persons directly or indirectly involved with the United States military community.
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