New Veteran – Owned Businesses and Texas Franchise Tax Exemption:
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: