Updated March 30, 2026 | 12 Min Read

How to File Texas Form 01-114: The 2026 Sales Tax Guide

For business owners, finding the right accounting services in Texas is the best way to keep up with state tax laws. If you sell products or taxable services, the most important form you need to know is Form 01-114, also called the Texas Sales and Use Tax Return. This guide explains the exact numbers you need, the deadlines you must follow, and how to avoid the 50 USD late fee the state charges even if you had zero sales.

Quick Summary: 2026 Texas Sales Tax Checklist

1. What Exactly is Form 01-114?

Form 01-114 is the mandatory report for business owners with a Sales Tax Permit. When you sell a taxable item, you are collecting money on behalf of the state. This form is how you report those collections. It covers the 6.25 percent state tax and any local taxes (up to 2 percent) for the city or county where the sale happened. Even if you hold a permit but had zero sales this period, you are still legally required to file this form.

2. Understanding Sales Tax vs. Use Tax

One reason businesses get audited is that they ignore the Use Tax part of Form 01-114. Proper reporting depends on distinguishing these two types of tax:

• Sales Tax: This is what you collect from your customers when they buy from you.
• Use Tax: This is what you owe the state for items you bought for your business. For example, if you buy office supplies from an out-of-state online seller and they don’t charge you Texas sales tax, you must report that purchase on Form 01-114 and pay the tax yourself.

3. Your Filing Frequency and Deadlines

The Texas Comptroller assigns your filing schedule based on the average amount of tax you remit to the state each month:

• Monthly Filers: Required if you remit more than 500 USD in tax per month.
• Quarterly Filers: Required if you remit between 50 USD and 500 USD in tax per month.
• Annual Filers: Required if you remit less than 50 USD in tax per month.

4. The Three Key Numbers You Need to File

When you log in to the Texas Webfile system to fill out Form 01-114, you must provide these three specific figures for your reporting period:

• Total Texas Sales: The gross amount of every sale made to a customer in Texas, including tax-free items.
• Taxable Sales: The amount of sales that are actually subject to tax after subtracting exemptions.
• Taxable Purchases: The total cost of business supplies where no sales tax was paid at the time of purchase.

5. How to Get a Discount on Your Taxes

Texas rewards businesses that file and pay on time. If you submit Form 01-114 and pay the tax by the 20th, the state allows you to keep 0.5 percent of the tax you collected. It is a small “service fee” paid to you for doing the state’s paperwork correctly and on schedule.

6. Penalties for Missing the Deadline

The Texas Comptroller is very strict about the 20th deadline. If you fail to meet it, your business faces the following consequences:

• The 50 USD Rule: An automatic 50 USD penalty is applied to every return filed late, even if you had zero sales and owe zero tax.
• Late Payment Fees: If you owe tax, a 5 percent penalty is added the day after the deadline. If the tax is not paid within 30 days, it increases to 10 percent.
• Interest: After 60 days, the state begins charging daily interest on the unpaid balance.

Frequently Asked Questions

1. How do I get a Resale Certificate?

You can download Form 01-339 (Texas Resale Certificate) from the Comptroller’s site. You fill this out and give it to your suppliers so they don’t charge you sales tax on items you plan to sell.

2. What if I missed the deadline?

You should file as soon as possible via Webfile. Filing quickly stops the 5 percent penalty from growing into a 10 percent penalty and limits the interest you will owe.

3. How do I find my Taxpayer Number?

This 11-digit number is printed on your Sales Tax Permit or on any tax notice mailed to you. It typically starts with the number 1 or 3.

4. Can I pay my sales tax by mail?

Yes, but it is not recommended. If the mail is delayed and arrives after the 20th, you will be charged a 50 USD fine. Online filing via Webfile is much safer.

5. Is this form the same as an income tax return?

No. This is a state-level consumption tax based on your total sales. You must still file your federal income tax return with the IRS by the April 15 deadline.

The post How to File Texas Form 01-114: The 2026 Sales Tax Guide appeared first on Welcome to Counto US.

Updated March 30, 2026 | 10 Min Read

Texas Form 05-163: Filing the “No Tax Due” Report in 2026

For small business owners, managing a company requires reliable accounting services in texas to stay compliant with state laws. The Franchise Tax is an annual requirement that must be managed even if no money is owed. While the state has simplified the process, most businesses must still complete specific filings to maintain their Good Standing. For the 2026 tax year, understanding the updated revenue thresholds and the role of Form 05-163 is essential for staying compliant.

Quick Summary: 2026 Texas Filing Checklist

1. The 2026 “No Tax Due” Threshold

The Texas Comptroller adjusts the Franchise Tax threshold every two years. For the 2026 reporting year, the threshold is 2.65 million USD. If your business revenue is at or below this limit, you owe zero tax, but you must still file paperwork with the state to confirm your status.

2. Is Form 05-163 Still Required?

Following recent law changes (SB 3), the rules for small businesses have shifted. Whether you need Form 05-163 depends on your revenue bracket:

• Under 1.23 Million USD: Most businesses in this bracket no longer file Form 05-163; they only file a Public Information Report (PIR).
• Between 1.23M and 2.65M USD: Businesses in this middle bracket generally still file Form 05-163 alongside their PIR.
• Passive Entities: Certain structures may still require Form 05-163 regardless of income level.

3. Maintaining Good Standing

Filing your annual state reports is the only way to keep your business in “Good Standing.” If you miss the deadline, you risk an automatic 50 USD penalty and the potential forfeiture of your business’s legal charter. This can lead to frozen bank accounts and the loss of the limited liability protection that shields your personal assets.

4. How to File Using Texas Webfile

The Texas Comptroller requires that almost all Franchise Tax reports be submitted electronically. You will need your Taxpayer Number and your Webfile Number (a 6-digit code starting with “RT”) to access the system. Filing online provides an immediate digital confirmation, ensuring your business is recorded as compliant in real-time.

Frequently Asked Questions

1. Do I file if I had zero income in 2025?

Yes. Even with zero revenue, you must file your annual Public Information Report (PIR) to maintain your business’s legal standing and avoid the 50 USD late fee.

2. Is there a fee to file these reports?

No state fee is required for filing timely reports electronically. You only incur costs if you miss the May 15 deadline.

3. What if my business is a Partnership?

Partnerships generally file an Ownership Information Report (OIR) instead of the PIR. If your revenue falls in the 1.23M to 2.65M USD bracket, you may still need to file a tax form as well.

4. How do I find my Webfile Number?

It is a 6-digit code usually found on the official tax notices mailed to your business address. If lost, you can contact the Texas Comptroller’s office directly for a replacement.

5. Does this replace my IRS tax return?

No. These are state-level filings for Texas. You must still file your federal income tax returns with the IRS, which are typically due in mid-April.

The post Texas Form 05-163: Filing the “No Tax Due” Report appeared first on Welcome to Counto US.

Updated March 30, 2026 | 12 Min Read

How to File the Texas Public Information Report (Form 05-102)

Operating a business in Texas requires strict adherence to state administrative and tax laws. One of the most critical annual obligations for any Texas LLC or Corporation is the Public Information Report (PIR), officially designated as Form 05-102. This report ensures that the state maintains an accurate public record of the individuals legally responsible for a business. Failing to file this report is the primary reason businesses in Texas lose their “Good Standing” status.

Quick Summary: 2026 PIR Filing Checklist

1. The Purpose of Form 05-102

The Public Information Report is not a tax return; it is a transparency document. The state of Texas mandates this filing to satisfy several regulatory objectives:

• Service of Process: It ensures the state has a verified list of individuals who can be served if the business is involved in legal proceedings.
• Public Transparency: It allows partners and consumers to verify who is running a company through official search tools.
• Administrative Verification: It acts as a yearly check-in to confirm that a business and its registered agent remain operational.

2. Domestic vs. Foreign Entities: Who Must File?

PIR obligations apply to all Domestic entities (formed in Texas) and Foreign entities (formed elsewhere but registered to conduct business in Texas). This includes standard Limited Liability Companies (LLCs) and Corporations. Note that Limited Partnerships (LPs) generally file an Ownership Information Report (OIR) instead of Form 05-102.

3. The Webfile Technical Process

The Texas Comptroller requires electronic filing via the Webfile system. To log in, you must have your 6-digit Webfile Number (RT), usually found on the tax notification letter mailed to your registered office. For the 2026 season, you are reporting the management structure as it exists on the day you submit the report.

4. Public Data and Privacy Considerations

Information submitted on Form 05-102 becomes a matter of public record. Mailing addresses for officers and directors are searchable by anyone online. Many founders choose to use a professional business address for these listings to prevent their home addresses from appearing on the state’s public search tool.

5. The Importance of Maintaining Good Standing

Filing your taxes is not enough to maintain your business’s legal standing; the PIR must also be submitted. Failure to file results in a “Forfeited” status, which can lead to the loss of legal protections and the inability to maintain business bank accounts. Reinstating a forfeited entity requires filing all back-reports and paying late fees for every missing year.

Frequently Asked Questions

1. Can I change my Registered Agent on Form 05-102?

No. To update a Registered Agent, you must file Form 401 with the Secretary of State and pay a 15 USD fee. The PIR only allows you to confirm the existing agent on record.

2. What if my LLC has no officers, only members?

In member-managed LLCs, you must list all members. Use the title “Member” or “Manager” as appropriate in the management section of the electronic report.

3. Is there a grace period for the May 15 deadline?

No. The Texas Comptroller does not offer a grace period for the PIR. Reports submitted after the deadline are subject to immediate interest and financial penalties.

4. My business is a Non-Profit; do I file this?

Non-profit corporations usually file a periodic report with the Secretary of State every four years rather than an annual PIR with the Comptroller. Always verify your entity’s specific requirements.

5. How do I find my Texas Taxpayer Number?

You can find your 11-digit number on previous tax filings, your certificate of formation, or by searching the “Taxable Entity Search” on the Comptroller’s official website.

The post How to File the Texas Public Information Report (Form 05-102) appeared first on Welcome to Counto US.

Updated March 30, 2026 | 10 Min Read

What Are the Q1 Estimated Tax Requirements for Texas Small Businesses?

The U.S. tax system is built on a pay-as-you-go model, requiring the Internal Revenue Service (IRS) to collect taxes as income is generated throughout the year. For Texas small business owners, April 15, 2026, is a mandatory deadline. It serves as both the final day to file the previous year’s return and the deadline for the first quarter (Q1) estimated tax payment for the current year.

Quick Summary: 2026 Q1 Estimated Tax Checklist

The Q1 Requirement: What You Need to Know

The Q1 estimated tax requirement is the federal mandate to pay taxes on all business income earned between January 1 and March 31. Because Texas has no state income tax, your requirement is strictly federal. You must meet this requirement if:

• You are a sole proprietor, partner, or S-corp shareholder expecting to owe 1,000 USD or more.
• Your current year withholdings will not cover at least 90 percent of your total 2026 tax liability.
• You wish to avoid the IRS underpayment penalty, which is an interest-based charge that begins accruing on April 16.

1. Federal Eligibility Requirements

According to the IRS, most business owners in Texas must make quarterly estimated payments if they fall into any of the following categories:

• Individuals and LLCs: If you expect to owe 1,000 USD or more in tax when your 2026 return is filed.
• C-Corporations: If the corporation expects its estimated tax for the year to be 500 USD or more.
• Exceptions: If your total tax liability for the 2025 tax year was zero, you generally do not have to make estimated payments for the first quarter of 2026.

2. Calculation Methods and Safe Harbor Rules

To protect against underpayment penalties, the IRS provides Safe Harbor guidelines. Business owners are compliant if they pay the smaller of:

• The 90 Percent Method: Remit 90 percent of the total tax liability expected for the current 2026 tax year.
• The 100 Percent Method: Remit 100 percent of the tax shown on your 2025 tax return.
• High-Income Earners: If your 2025 Adjusted Gross Income exceeded 150,000 USD, you must remit 110 percent of your 2025 tax to meet the Safe Harbor.

3. Breakdown of Taxes Owed

Estimated payments cover more than just standard income tax. As a Texas business owner, your payment includes:

• Income Tax: Progressive tax based on your projected 2026 annual income bracket.
• Self-Employment Tax: Currently 15.3 percent of net earnings (12.4 percent for Social Security and 2.9 percent for Medicare).
• Additional Medicare Tax: A 0.9 percent tax if your income exceeds 200,000 USD (250,000 USD for married couples).

4. The Texas Advantage: Federal Only

Because Texas has no state-level income tax, you only have to manage one set of quarterly payments at the federal level. However, do not forget the Texas Franchise Tax, which is due by May 15, 2026. While many small businesses fall below the threshold to owe money, the state mandates that all LLCs and Corporations file the informational paperwork to remain in good standing.

5. Official IRS Payment Channels

The IRS provides several secure methods for remitting Q1 payments. Electronic options are preferred to ensure an accurate timestamp.

• IRS Direct Pay: A free service for individuals to pay directly from a checking or savings account.
• EFTPS: The Electronic Federal Tax Payment System, highly recommended for business owners for detailed tracking.
• Form 1040-ES: For those choosing to pay by mail with a check or money order.

Frequently Asked Questions

1. What is the penalty for missing the Q1 deadline?

The IRS applies an underpayment penalty. This is an interest charge calculated from the original due date of the installment (April 15) to the date the payment is actually made.

2. Can I pay my Q1 tax by applying my 2025 refund?

Yes. When filing your 2025 return, you can instruct the IRS to apply any overpayment toward your 2026 Q1 estimated tax. This is considered a timely payment if the return is filed by April 15.

3. What if my business income is seasonal?

You can use the Annualized Income Installment Method (IRS Form 2210). This allows you to pay tax based on when you actually earned the profit, which is ideal for businesses with variable income.

4. Are quarterly payments required if my business is in a loss?

No. Estimated taxes are only due on taxable income. If your deductible business expenses result in a net loss for the quarter, you generally do not have a federal estimated tax obligation for that period.

5. Does the IRS provide a late payment grace period?

No. Unlike some state-level agencies, the IRS has no grace period. Payments made after the deadline on April 15 are legally late and trigger interest immediately.

The post What Are the Q1 Estimated Tax Requirements for Texas Small Businesses? appeared first on Welcome to Counto US.

Updated March 2026 | 10 Min Read

How to File Federal Income Tax for Your Texas LLC: The 2026 Guide

Texas is a premier destination for business owners because it has no state income tax. However, every Texas LLC is subject to federal tax regulations overseen by the Internal Revenue Service (IRS). While the state doesn’t collect a portion of your earnings, you must file a federal return by April 15, 2026. The specific forms and processes required depend on your LLC’s tax classification. Whether you operate as a sole owner or with business partners, this guide outlines the necessary steps to maintain federal compliance.

Quick Summary: 2026 Texas LLC Filing Checklist

1. Single-Member LLCs (Disregarded Entities)

Most Texas LLCs with a single owner are classified as “disregarded entities” by default. In this structure, the IRS does not tax the business as a separate entity; instead, the financial activity is reported directly on the owner’s personal return.

• The Filing Requirement: You report all business income and losses on Schedule C and attach it to your individual Form 1040.
• Self-Employment Contributions: Single-member owners must also file Schedule SE to pay the 15.3% self-employment tax for Social Security and Medicare.

2. Multi-Member LLCs (Partnerships)

If your Texas LLC has two or more members, it is treated as a partnership. This is a “pass-through” entity, meaning the business itself does not pay income tax, but it must report its annual activity to the IRS.

• The Informational Return: The LLC was required to file Form 1065 by March 16, 2026.
• Individual Reporting: Each partner receives a Schedule K-1. This information must be reported on the partner’s individual Form 1040 by the April 15 deadline.

3. LLCs Taxed as Corporations

If you have elected to have your LLC taxed as a corporation (S-Corp or C-Corp) by filing Form 2553 or Form 8832, your requirements differ:

• S-Corporations: Like a partnership, the entity return was due in March. You report your share of income via a K-1 on your personal April 15 return.
• C-Corporations: The business must file Form 1120 and pay corporate income tax. Owners only report income if they received a salary (W-2) or dividends (1099-DIV).

4. State Obligation: The Texas Franchise Tax

Although Texas does not have a state income tax, LLCs must comply with the Texas Franchise Tax. Most small businesses fall under the “No Tax Due” threshold, but they are still required to file a Franchise Tax Report and a Public Information Report (PIR) with the Texas Comptroller by May 15, 2026. Failing to file can lead to the loss of your LLC’s legal standing.

Frequently Asked Questions

1. Does a Texas LLC need to file if it had $0 in income?

If the LLC is a Partnership or S-Corp, it must generally file an informational return even with no activity. Single-member LLCs typically do not need to file Schedule C if there was no business income or expenses to report for the year.

2. Can I request more time to file my return?

Yes. Filing Form 4868 provides an automatic six-month extension until October 15. However, this is not an extension to pay; you must still remit your estimated tax liability by April 15 to avoid interest and late-payment penalties.

3. How are health insurance premiums handled for LLC owners?

Self-employed LLC owners can often deduct 100% of their health insurance premiums on Form 1040. This deduction reduces your adjusted gross income (AGI) but does not reduce your self-employment tax.

4. I live outside of Texas but own a Texas LLC; where do I file?

You will file a federal return with the IRS as usual. While you will not owe state income tax to Texas, you may be required to report that income and pay taxes to the state where you are a legal resident.

5. What are the accepted methods for paying federal taxes?

The fastest method is IRS Direct Pay on the official IRS website. You can also pay via the EFTPS system, authorized card processors, or by mailing a check with Form 1040-V.

The post How to File Federal Income Tax for Your Texas LLC appeared first on Welcome to Counto US.

For international entrepreneurs and non-resident founders, the United States is the premier market for scaling a global brand. After forming your LLC and securing your Employer Identification Number (EIN), you may encounter a final administrative step: obtaining a personal tax identification number. Since most foreign founders are ineligible for a Social Security Number (SSN), the IRS provides an Individual Taxpayer Identification Number (ITIN).

Quick Summary: 2026 ITIN Application Checklist

What is an ITIN?

An ITIN is a tax processing number issued by the IRS for those who must have a U.S. taxpayer identification number but are not eligible for an SSN. It functions as follows:

• Universal Eligibility: It is for anyone—regardless of immigration status—who has a U.S. tax reporting requirement. This includes resident aliens, non-residents, and their families.
• Strictly for Tax: An ITIN is strictly for tax processing. It does not authorize work in the U.S. or provide eligibility for U.S. Social Security benefits.
• A Personal Identifier: While the EIN identifies your business entity, the ITIN identifies you as an individual to the IRS.

1. Understand When an ITIN is Necessary

For many international founders, an ITIN is not a “day-one” requirement. You specifically need one if:

• Personal Tax Obligations: You are required to file a U.S. federal tax return (Form 1040-NR) to report personal income from your U.S. business activities.
• Claiming Tax Treaty Benefits: You want to reduce the standard 30% withholding tax on U.S.-sourced income.
• Banking Requirements: While neobanks often open business accounts with just an EIN and passport, some traditional banks may require an ITIN for personal identity verification.

2. The Form W-7 Requirements

The core of your application is IRS Form W-7. To avoid rejection, the document must be filled out with total precision:

• Legal Name: Must match your passport exactly (including middle names).
• Reason for Applying: Most founders select Box b (Non-resident alien filing a U.S. federal tax return).

3. The Passport as the “Gold Standard”

To approve an ITIN, the IRS must verify both your identity and your foreign status. A valid international passport is the only document that proves both on its own. While the IRS technically accepts combinations of other documents, using a passport is the most reliable method for international business owners.

4. The Tax Return Linkage

The #1 reason for ITIN rejection is failing to attach a federal tax return. In 2026, the IRS requires your Form W-7, such as Form 1040-NR. This proves to the IRS that you have a legitimate tax need for the number. The IRS will process your ITIN application first, assign your number, and then proceed to process the tax return.

5. Submission: Mail-In vs. CAA Verification

Founders have two primary paths for final submission in 2026:

• The Mail-In Path: You must mail your original physical passport to the IRS in Austin, Texas. They return it after 8–11 weeks, which carries a risk of loss in international transit.
• Certified Acceptance Agents (CAA): Professional services like Counto verify your passport via a video call. This allows you to keep your physical passport while we send a certified forensic copy to the IRS.

Frequently Asked Questions

How long does it take to get an ITIN in 2026?

Once submitted, the IRS typically processes the application in 7 to 11 weeks. During peak tax season, wait times can extend slightly longer.

Does an ITIN expire?

Yes. If an ITIN is not used on a federal tax return at least once in three consecutive years, it will expire and must be renewed.

Can I open a U.S. bank account with an ITIN?

Yes. While not a universal requirement for all business accounts, most major U.S. banks and digital platforms accept an ITIN as a substitute for an SSN for identity verification.

The post How to Apply for an ITIN in the US: The 2026 Guide appeared first on Welcome to Counto US.

For foreign entrepreneurs, the United States is the best place to grow a company, but getting a bank account is often the hardest part. A US business bank account lets you take payments in dollars, access professional payment processors, and establishes the financial presence needed to scale.

In 2026, you can now open a US bank account from your home country without flying to America. This guide shows you the 7 basic steps to get your account while keeping your accounting for small business simple and correct.

Quick Summary: 2026 US Banking Checklist

1. Form Your US Business (LLC or Corp)

You cannot open a US business account as a non-resident until you have a legal company. Most founders choose an LLC because it is easier to manage from abroad. Once you register your business in a state like Texas or Wyoming, you will receive Articles of Organization. The bank will strictly require this document to prove the entity exists.

2. Get Your Free Tax ID (EIN)

The Employer Identification Number (EIN) is your business tax ID. It is required for every US bank account. For non-residents, you apply by sending a form (SS-4) to the IRS via fax. In early 2026, the IRS is sending these back in about 4 to 7 business days.

3. Use Your International Passport

Banks must check who owns the company under federal KYC (Know Your Customer) laws. You do not need a US visa, but you do need a valid international passport. Make sure it has at least 6 months before it expires to avoid application delays during the bank’s review.

4. Secure a Verified Physical US Address

Most US banks will reject your application if you use a basic P.O. Box or a standard virtual mailbox. In 2026, you should use a business office service that provides a unique suite number or a physical lease to pass the bank’s internal security scans.

5. Evaluate Institution Models

Founders must choose between two primary paths for banking in 2026:

• Digital-First Platforms: These allow for 100% remote account opening and offer superior API integrations for bookkeeping.
• Retail Banks: These usually require the signer to be physically present in a US branch to finalize the account.

6. Confirm the Federal BOI Exemption

Crucial 2026 Update: Under the latest federal policy, domestic US entities—including new LLCs owned by non-residents—are now exempt from Beneficial Ownership Information (BOI) reporting. Only entities formed under the laws of a foreign country and then registered in the US must currently file with FinCEN.

7. Make Your First Swift Deposit

After the bank approves your application, you must fund the account. For non-residents, an international Swift wire is the standard method. Ensure your local bank allows outgoing transfers to US business accounts to avoid activation delays.

Frequently Asked Questions

Do I need a US Social Security Number (SSN) to open an account?

No. Foreign founders can use their passport and their business Tax ID (EIN) to open an account. You do not need to live in the US.

Do I need a US phone number to open an account?

Most institutions require a US-based number for two-factor authentication (2FA). You should use a US-based VOIP service that allows you to receive text codes abroad.

How long does it take to open a US business account?

Once you have your Tax ID (4–7 days via fax), the bank review process typically takes 3 to 7 business days for final approval.

The post How to Open a US Business Bank Account for Non-Residents appeared first on Welcome to Counto US.

Texas remains the premier destination for business growth in 2026. With no state individual or corporate income tax, it offers an ideal environment for entrepreneurs to maximize margins. However, staying compliant requires navigating specific state laws and newly enforced federal transparency mandates.

This guide breaks down the essential steps for establishing your entity while keeping your accounting for small business aligned for 2026 compliance and optimization.

Quick Summary: 2026 Texas Formation Checklist

1. Understanding Texas Business Structures

Choosing the right legal structure is the most critical decision for your tax services and strategy. In 2026, the primary paths are:

• LLC: Provides personal asset protection and pass-through taxation. It is the gold standard for small businesses because it shields personal savings from business liabilities.
• Corporation: Necessary if you plan to seek venture capital or issue public stock. This structure involves shareholders, directors, and formal administrative requirements.

2. Business Name Verification

Your business name must be distinguishable from all other registered entities in Texas. Use the SOSDirect database to check availability. In 2026, the state charges a 1 dollar fee per search. Your name must also include a designator such as LLC or Inc.

3. Appoint a Registered Agent

Texas law requires every business to appoint an agent available at a physical Texas street address during business hours. While you can act as your own agent, your residential address will become public record.

4. File the Certificate of Formation

Officially establish your business by filing Form 201 for Corporations or Form 205 for LLCs. In 2026, most founders use the Texas Express portal for tiered processing. The standard state filing fee is a flat 300 dollars.

5. Obtain Your Federal EIN

After your state filing is approved, you must obtain an Employer Identification Number (EIN) from the IRS. This free tax ID acts as a social security number for your business and is required to open a business bank account and hire employees.

6. Verify Federal BOI Compliance

As of early 2026, domestic U.S. entities are now exempt from federal Beneficial Ownership Information (BOI) reporting under current FinCEN policy. Only foreign reporting companies registered in the U.S. are currently required to file this disclosure.

7. Ongoing State Tax Compliance

Texas does not have a state income tax, but utilizes a Franchise Tax system. For 2026 reports, the No Tax Due threshold is 2,650,000 dollars.

Frequently Asked Questions

Do I need to be a Texas resident to start a business there?

No. You can live anywhere in the world and own a Texas entity. However, you must appoint a Registered Agent who maintains a physical street address within the state of Texas.

Can I change my business structure from an LLC to a Corporation later?

Yes. Texas law allows for statutory conversion, though it requires specific filings and can have significant tax implications. It is best to consult with an accountant before making this change.

Does a Texas LLC protect my personal assets?

Yes, provided you maintain a separate business bank account and keep professional financial records. This separation is vital for protecting personal property from business liabilities.

The post How to Incorporate a Business in Texas: The Ultimate 2026 Guide appeared first on Welcome to Counto US.

The post The Ultimate Tax Deduction Checklist for U.S. Sole Proprietors: Legally Lower Your Schedule C Taxable Income appeared first on Welcome to Counto US.

Running a pop-up shop in the US offers a flexible, low-risk way to sell products, test markets, and connect directly with customers. One key aspect of running a successful pop-up business is understanding the IRS-recognized tax deductions available. Properly claiming these deductions can reduce taxable income, improve cash flow, and increase overall profitability.

IRS-Recognized Tax Deductions for Pop-Up Shops

Startup Costs

Pop-up shop startup expenses can be deducted up to $5,000. This includes costs for market research, business licenses, legal fees, and advertising that occurs before your shop begins operations. These expenses help prepare your business for a successful launch.

Rent and Utilities

Renting your temporary space? Lease payments and associated utilities—electricity, water, and internet—are fully deductible as ordinary business expenses, reducing your taxable income.

Advertising and Marketing

All costs related to promoting your pop-up shop are deductible. This includes printed signage, flyers, social media ads, email campaigns, and influencer collaborations. Marketing expenses directly support your business growth.

Inventory and Supplies

Expenses for inventory purchased for resale, packaging materials, and point-of-sale items are deductible. Keeping accurate records of all product and supply purchases is essential for proper reporting.

 Your books should work as fast as you do. Get real-time insights, automated reports, and expert guidance—all in one place. Experience live accounting here.

Equipment and Furniture

Essential equipment such as tables, shelving, display racks, cash registers, and POS devices can be deducted. You can deduct the full cost in the year of purchase or depreciate it over time, depending on IRS rules.

Business Meals and Travel

Business-related meals may be 50% to 100% deductible with proper documentation. Travel expenses for events, transporting inventory, or supplier meetings are also eligible for deductions.

Insurance and Licensing

Premiums for business insurance and fees for licenses or permits necessary to operate your pop-up shop are deductible, including general liability, property, and event-specific coverage.

Other Ordinary and Necessary Expenses

Other operating expenses, such as phone and internet, cleaning, décor, and professional services (accounting, legal) required to run the pop-up business, are deductible under IRS guidelines.

Key Tips for Claiming Deductions

• Document Everything: Keep receipts, invoices, and proof of payments for all expenses.

• Confirm Business Purpose: Ensure expenses are ordinary (common for your industry) and necessary (helpful and appropriate).

• Consult Professionals: Work with tax advisors or accountants to ensure compliance and maximize allowable deductions.

How Accounting Services in the US Can Help

Professional accounting services, like Counto, make managing pop-up shop finances easier and more efficient. They provide:

• Expense Tracking: Automatically categorize and track deductible expenses.

• Tax Filing Support: Prepare accurate federal and state tax filings while ensuring all eligible deductions are claimed.

• Compliance Assistance: Stay aligned with IRS regulations and state-specific sales tax requirements.

• Financial Insights: Generate reports to analyze profitability, margins, and cash flow trends.

• Audit Preparedness: Maintain organized financial records in case of IRS review.

Leveraging professional accounting services saves time, reduces errors, and ensures that your pop-up shop operates efficiently and profitably.

Summary

For US small business owners, understanding and leveraging IRS-approved tax deductions is vital for the success of a pop-up shop. Deductions—from startup costs to insurance—can significantly reduce taxable income and enhance cash flow. By keeping detailed records and using accounting services like Counto, pop-up shop owners can maximize savings, ensure compliance, and focus on growing their business. Strategic tax management allows entrepreneurs to expand operations, test markets, and build a loyal customer base with confidence.

Your Books, Automated. Your Questions, Answered.

Manual bookkeeping eats into time you could spend growing your business. Traditional accounting services charge more but still need constant guidance. There’s a better way.

Counto’s modern accounting solution combines AI that learns your business with expert human oversight. Once our system understands your patterns, it handles daily bookkeeping automatically. Professional accountants review everything for accuracy, and you get instant access to your dedicated Customer Success Manager via SMS or phone—no more waiting for answers about your finances.

Join forward-thinking businesses who’ve upgraded to intelligent accounting that adapts to you, not the other way around. Ready for accounting that actually gets your business? Chat with us now, email hello@mycounto.com, or use our contact form.

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The post Pop-Up Shop Tax Deductions for US Small Businesses appeared first on Welcome to Counto US.