My Texas LLC Is Not in Good Standing: How to Fix It
- MJ Cunningham, EA
- Apr 26
- 3 min read
A Texas LLC that is not in good standing has already lost legal protections most owners do not even realize are gone. Here is what it means and how to fix it before it gets worse.
If your Texas LLC is not in good standing, it usually means your business is non compliant with Texas franchise tax requirements.
Many business owners discover this when applying for financing, renewing licenses, or checking their business status online.
Being listed as not in good standing can create legal and financial risk, but it is usually fixable.
If your Texas LLC is not in good standing, start your Texas LLC restoration now.
1. What Does Not in Good Standing Mean in Texas
When your Texas LLC is not in good standing, the state has flagged your business as non compliant. This typically happens when required filings were not submitted.
Your status may show:
Not in good standing
Franchise tax forfeited
Right to transact business forfeited
Involuntarily terminated
SOS forfeited
All of these indicate your Texas LLC needs to be reinstated.
2. Why Your Texas LLC Is Not in Good Standing
The most common reason a Texas LLC is not in good standing is missing franchise tax filings.
This may include:
Franchise tax report not filed
No Tax Due Report not filed
EZ Computation report not filed
Public Information Report missing
Penalties not paid
Multiple years not filed
Even if your LLC owes no tax, filings are still required.
3. What Happens When Your Texas LLC Is Not in Good Standing
When your LLC is not in good standing, your business may face several issues.
Your Texas LLC may:
Lose right to transact business
Be listed as forfeited
Expose owners to personal liability
Be unable to sign contracts
Be unable to sue in Texas
Experience banking issues
Have vendor compliance problems
Be terminated by the state
These risks increase the longer the issue remains unresolved.
4. Can You Still Operate a Texas LLC That Is Not in Good Standing
Many businesses continue operating while not in good standing without realizing it. While this is common, it may create risk.
Operating while not in good standing may:
Create personal liability exposure
Cause contract issues
Delay financing
Affect licensing
Trigger compliance problems
The safest approach is restoring good standing as soon as possible.
5. How to Fix a Texas LLC Not in Good Standing
To restore good standing, the missing filings must be completed.
This usually includes:
Filing missing franchise tax reports
Filing Public Information Reports
Paying penalties if applicable
Requesting reinstatement
Restoring active status
Once processed, your Texas LLC returns to good standing.
6. How Long Does It Take to Restore Good Standing
Timing depends on:
Number of missing years
Whether taxes are owed
Whether Secretary of State forfeiture occurred
Comptroller processing time
Some LLCs can be restored quickly once filings are submitted.
7. We Can Restore Your Texas LLC to Good Standing
If your Texas LLC is not in good standing, we can handle everything.
We will:
Review your Texas entity
Identify missing filings
Prepare required reports
File with Texas Comptroller
Request reinstatement
Restore good standing
We will review your status and tell you exactly what needs to be done.#
Final Thoughts
A Texas LLC that is not in good standing can usually be fixed quickly. The most important step is acting before additional risks arise.
If your Texas LLC is not in good standing, start your restoration now and we will help you restore your business today.
