Closing a Texas LLC involves two separate agencies — and if you go to them in the wrong order, the Secretary of State will reject your filing. Texas requires you to get a Certificate of Account Status from the Comptroller first. Only then can you file Form 651 (Certificate of Termination) with the SOS.

Most dissolution guides skip the Comptroller step entirely. This one doesn't. Below is the exact sequence, the right form numbers, the $40 fee, and what the SOSDirect filing looks like — so you can close your Texas LLC cleanly the first time.

The good news: Texas has no state income tax, so there's no FTB-style ongoing notice problem like California. Get the Comptroller clearance right, and the SOS process is straightforward.

The Texas Two-Step: Why the Order Matters

Unlike most states, Texas requires you to deal with two agencies in a specific order before your LLC is officially terminated. Here's the big picture before we go step by step:

1. Member vote → document the dissolution decision in writing
2. Wind up → settle debts, notify creditors, distribute remaining assets
3. Comptroller clearance → request a Certificate of Account Status (Form 05-359 or 05-305)
4. File Form 651 (Certificate of Termination) with the Texas SOS via SOSDirect — attach the Comptroller certificate
5. File final federal tax returns with the IRS

The reason Texas requires the Comptroller clearance upfront is to confirm your LLC has no outstanding franchise tax liability. Even if your LLC was too small to owe franchise tax (many small LLCs fall below the "no tax due" threshold), you still need the official certificate proving that status before the SOS will process your termination.

Step 1: Vote to Dissolve and Document the Decision

Before any state filings, the LLC's members must formally agree to dissolve. How this looks depends on your operating agreement:

• Single-member LLC: You make the call. Write a brief, dated statement — something like: "I, [Name], the sole member of [LLC Name], hereby decide to dissolve the company effective [date]." Signed and dated is enough in most cases.
• Multi-member LLC: Check your operating agreement for the required vote threshold. Most agreements require a majority or unanimous member vote. Hold a meeting, record the votes, and keep written minutes with signatures.

Texas law (Bus. Orgs. Code §101.552) allows dissolution by unanimous consent of all members, or by a vote as specified in the operating agreement. If members are deadlocked and can't agree, a court can order judicial dissolution — but that route takes months and costs significantly more.

Keep your written resolution. The SOS doesn't ask for it during Form 651 filing, but it's your legal protection if a creditor or former member disputes the process later.

Step 2: Wind Up the Business — Settle Debts Before Filing

Texas law requires your LLC to complete a formal wind-up process before termination. This means:

• Pay or arrange to pay all known debts — employees, vendors, leases, loans, and any other obligations
• Notify known creditors in writing that the LLC is winding up and give them a reasonable deadline to submit claims (90 days is a common standard)
• Cancel your Texas business licenses with relevant state and local agencies — city/county business permits, professional licenses, sales tax permits (if applicable)
• Close your Texas sales tax account with the Comptroller if you collected state sales tax — file a final sales tax return
• Distribute remaining assets to members only after all debts are paid — members can be personally liable for distributions made before creditors are satisfied

Texas does not require you to publish a dissolution notice in a newspaper. But written creditor notification protects members from personal liability for claims that surface after asset distribution. Keep records of every notice sent and every claim resolved.

Step 3: Get Your Certificate of Account Status from the Comptroller

This is the step that catches most Texas LLC owners off guard. Before you can file Form 651 with the SOS, you need a Certificate of Account Status from the Texas Comptroller — a document confirming your LLC has no outstanding franchise tax obligations.

There are two forms depending on your purpose:

• Form 05-359 — Request for Certificate of Account Status (for dissolution/termination purposes specifically)
• Form 05-305 — Request for Certificate of Account Status (for other purposes, such as reinstatement). For LLC dissolution, Form 05-359 is the correct one.

How to request it:

1. Go to the Texas Comptroller website (comptroller.texas.gov)
2. Under "Taxes" → "Franchise Tax" → "Dissolve or Terminate a Business," download Form 05-359 or request it online via the Comptroller's eSystems portal
3. Submit the form along with any required final franchise tax reports
4. If your LLC had zero taxable revenue (below the $2.47 million no-tax-due threshold for 2026), file a No Tax Due Report (Form 05-163) — you still need to request the Certificate of Account Status to prove this to the SOS

Once you have the Certificate of Account Status in hand, you're ready for the SOS filing.

Step 4: File Form 651 (Certificate of Termination) via SOSDirect

With your Comptroller certificate ready, head to the Texas Secretary of State's online filing system — SOSDirect — to file Form 651, the Certificate of Termination.

What Form 651 requires:

• Your LLC's exact legal name and SOS file number (find it by searching at SOSDirect or the SOS name search)
• The Certificate of Account Status from the Comptroller — attached as a PDF in the online filing, or included with a paper filing
• A statement that all debts have been paid or adequately provided for, and assets have been distributed
• The effective date of termination (can be the filing date or a future date)
• Signature of an authorized person — a manager (if manager-managed) or member (if member-managed)

How to file:

1. Go to SOSDirect (sos.state.tx.us → "SOSDirect")
2. Create or log in to your SOSDirect account
3. Select "Terminate a Domestic LLC" and follow the Form 651 prompts
4. Upload your Comptroller Certificate of Account Status when prompted
5. Pay the $40 filing fee by credit card
6. Submit — you'll receive an email confirmation with a stamped filing certificate

You can also file by mail by sending a completed paper Form 651 with the Comptroller certificate and a $40 check to: Secretary of State, P.O. Box 13697, Austin, TX 78711-3697. Mail processing is slower (2–3 weeks) vs. SOSDirect's 3–5 business days.

Step 5: File Your Final Federal Tax Returns

Texas has no state income tax, so there's no separate state income tax return to worry about after the Comptroller is handled. The remaining tax step is your final federal return with the IRS.

What you file depends on how your LLC is taxed:

• Single-member LLC (disregarded entity): File a final Schedule C (or Schedule E if real estate) attached to your personal Form 1040. Check the "Final Return" box. If your LLC had employees, also file final payroll forms (941, W-2s, 940).
• Multi-member LLC (partnership): File a final Form 1065 and issue final Schedule K-1s to all members. Check the "Final Return" box on Form 1065. Members report their K-1 share on their personal returns.
• LLC taxed as S-Corp: File a final Form 1120-S. Check the "Final Return" box. Issue final K-1s to shareholders.
• LLC taxed as C-Corp: File a final Form 1120. Check the "Final Return" box.

The "Final Return" checkbox is critical — it signals to the IRS that your entity is closing. Without it, the IRS will expect future returns and may generate automated notices years later.

If your LLC had employees at any point, also complete these payroll closeout steps:

• File final Form 941 (quarterly payroll) for the last quarter of operation
• File final Form 940 (annual FUTA) — check the "Final Return" box
• Issue W-2s to all employees by January 31 of the following year
• Cancel your EIN — write to the IRS to close your business account (send a letter to: Internal Revenue Service, Cincinnati, OH 45999)

Texas LLC Dissolution vs. California & Florida — At a Glance

Frequently Asked Questions

Bottom Line — Your Texas LLC Dissolution Checklist

Dissolving a Texas LLC is more streamlined than California (no $800 annual minimum, just one SOS filing) — but the Comptroller step adds time you need to plan for. Here's the complete checklist in the right order:

1. ☐ Hold a member vote and document the dissolution decision in writing
2. ☐ Pay all outstanding debts and send written notice to known creditors
3. ☐ Cancel state and local licenses — sales tax permit, business licenses, EDD/payroll accounts if applicable
4. ☐ File final franchise tax report (or No Tax Due Report, Form 05-163) with the Comptroller
5. ☐ Request Certificate of Account Status (Form 05-359) from the Comptroller — wait for it (10–15 business days)
6. ☐ File Form 651 via SOSDirect — attach the Comptroller certificate — pay $40 — allow 3–5 business days
7. ☐ File final federal return (Schedule C / Form 1065 / 1120-S) — check the "Final Return" box
8. ☐ Distribute remaining assets to members after all obligations are cleared
9. ☐ Close business bank accounts and retain records for 7+ years

The single most important thing to remember: Comptroller clearance before SOS filing. Get Form 05-359 approved, attach that certificate to Form 651 on SOSDirect, and you'll clear the Texas process cleanly in under six weeks.

This article is for general informational purposes only and is not legal, tax, or financial advice. Texas LLC dissolution procedures, Comptroller requirements, franchise tax thresholds, and filing fees may change — verify current information with the Texas Secretary of State, the Texas Comptroller, and a licensed attorney or CPA before filing. Information is current as of May 2026.