What the Form Is For
Form 05-164 is the official document Texas businesses use to request extra time to file their franchise tax reports with the Texas Comptroller of Public Accounts. The Texas franchise tax is a privilege tax that most businesses formed in Texas or doing business in Texas must pay each year. When a company needs more time beyond the standard May 15 deadline to prepare and submit its annual franchise tax report, Form 05-164 provides a formal mechanism to obtain that extension.
The form serves as both a request for additional filing time and, in most cases, a payment voucher. Texas operates on the principle that extensions are not automatic—they must be requested properly and typically require payment of a substantial portion of the anticipated tax liability. For the 2017 report year, this form allowed businesses to push their filing deadline from May 15 to November 15, giving them an additional six months to gather financial information, complete calculations, and submit accurate reports.
Importantly, this form is designed for businesses that are not required to make mandatory Electronic Funds Transfer (EFT) payments, or for those EFT payers requesting a second extension. Companies that paid $500,000 or more in franchise taxes during the previous state fiscal year must use the TEXNET system instead of this paper form for their first extension request.
When You’d Use It
Late Filing Situations
You would use Form 05-164 when you cannot file your franchise tax report by the original May 15 due date. The extension request must be submitted on or before May 15—meaning the form itself is not a remedy for missing the deadline, but rather a tool for planning ahead when you know you'll need extra time.
Common Use Cases
The form applies to several specific situations:
- Annual reports for entities not required to pay by EFT
- Businesses submitting payments via mail or Webfile
- Entities required to pay by EFT (depending on threshold and extension stage)
EFT Threshold Scenarios
- $10,000–$499,999.99 paid → Use Webfile (no paper form needed)
- $500,000+ paid → Use TEXNET for first extension
- Second extension → Form 05-164 may be used
Special Situations
Final Reports
The form is also used for final reports when a business is terminating its Texas operations or losing its nexus with the state. Final reports are typically due within 60 days of the triggering event, and Form 05-164 can extend that deadline by an additional 45 days.
Combined Groups
Combined groups must file:
- Form 05-164
- Form 05-165 (Extension Affiliate List)
Important Limitation
This is not an amended return form. If you've already filed your franchise tax report and need to correct it, you'll file an amended report, not an extension request.
Key Rules or Details for 2017
Payment Requirement
Extensions require payment:
- 90% of current year estimated tax, OR
- 100% of prior year tax
Restrictions on Prior-Year Method
You cannot use the 100% method if:
- First year subject to franchise tax
- Previously filed in a combined group but now filing separately
Filing Deadline Rules
- Must be submitted by May 15
- If weekend/holiday → next business day
- Late requests are invalid
Extension Scope
- Extends filing deadline only (not payment obligation)
- New deadline: November 15
Combined Group Requirement
Must include:
- Form 05-165 with Form 05-164
Webfile Rule
If you pay online:
- Do NOT submit paper form
- Electronic payment = extension request
Step-by-Step (High Level)
Step 1: Review Prior Year Tax
Review your 2016 report to determine prior tax liability.
Step 2: Estimate Current Year Tax
Gather financial data and estimate 2017 liability.
Step 3: Choose Payment Method
Compare:
- 90% current estimate
- 100% prior year
Choose the lower (if eligible).
Step 4: Calculate Payment
- 90% method → multiply estimate × 0.90
- 100% method → use prior report value
Step 5: Complete Form 05-164
Include:
- Texas taxpayer number
- Entity name
- Report year (2017)
- Payment amount
- Contact details
Combined Groups
Also complete Form 05-165.
Step 6: Submit by May 15
Options:
- Mail with check
- Webfile (online)
- TEXNET (for large EFT payers)
Step 7: Keep Confirmation
- Save electronic confirmation OR
- Keep mailed copy + proof
Step 8: Prepare for November 15
Continue preparing full report.
Common Mistakes and How to Avoid Them
Waiting Until the Deadline
Fix: File early to avoid last-minute risks.
Underpaying the Extension
Fix: Estimate conservatively and overpay slightly if needed.
Misusing the 100% Prior-Year Rule
Fix: Confirm eligibility before choosing this option.
Filing Duplicate Requests
Fix: Use only one method (paper OR electronic).
Missing Form 05-165 for Groups
Fix: Always include it for combined filings.
Assuming Extension Removes Filing Requirement
Fix: You still must file by November 15.
Confusing Extension Payment With Total Tax
Fix: Pay remaining balance when filing final report.
What Happens After You File
Extension Approval
If submitted correctly:
- Deadline moves to November 15
Processing
- Webfile → instant confirmation
- Paper → several weeks
Preparation Period
From May to November:
- Gather records
- Complete calculations
Final Filing
By November 15:
- File full report
- Pay remaining balance
Overpayment or Balance Due
- Overpaid → refund issued
- Underpaid → balance due
Penalties for Underpayment
If less than required:
- Penalties apply retroactively
Missing the Extended Deadline
Penalties include:
- $50 late filing penalty
- 5% penalty (1–30 days late)
- 10% penalty (30+ days late)
- Interest starts after 61 days
FAQs
Can I file an extension if I don't owe any franchise tax?
Yes, you can file a no-payment extension. If your business falls below the no tax due threshold for the reporting year, you may still request an extension by filing Form 05-164 without payment. However, entities below the threshold may also be eligible to file a Public Information Report instead of a full franchise tax report, which has different requirements. Review the threshold amounts for your report year—$1,110,000 for 2016 and 2017—to determine your filing obligations.
What happens if I calculate my extension payment wrong?
If your extension payment is less than required—below 90 percent of your actual tax or below 100 percent of your prior year tax—the Comptroller will assess penalties and interest. The penalty applies to the shortfall from the original May 15 due date, not from the extended November 15 date. To minimize this risk, be conservative in your estimates and consider paying slightly more than the minimum required. Any overpayment will be refunded or credited when you file your actual report.
Can I get more than six months to file my report?
For most entities, the maximum extension is from May 15 to November 15. However, entities required to pay by EFT receive their extensions in stages. These businesses can get a first extension to August 15, then request a second extension to November 15. This effectively provides the same six-month total extension but requires two separate requests. Businesses paying $500,000 or more use TEXNET for the first extension and may use either TEXNET or Form 05-164 for the second extension.
Do I need to file an extension for my Public Information Report or Ownership Information Report?
No, the extension for your franchise tax report automatically extends your information report deadline as well. Both reports receive the same extended November 15 due date. You don't need to file a separate extension request for the information report. However, remember that even if you file an extension for your tax report, you must still file both reports by the extended deadline.
What if I'm part of a combined group—do I file my own extension?
Combined groups file a single extension that covers all group members. The reporting entity—typically the parent or lead company—files Form 05-164 along with Form 05-165, which lists all affiliated entities in the combined group. Individual members do not file separate extension requests. All members receive the same extended deadline. If Form 05-165 is not filed with Form 05-164, the extension may not be valid for all group members.
Can I file my franchise tax report before the extended deadline?
Yes, absolutely. The extended deadline of November 15 is the latest date you can file without penalty, but you can file your report any time between May 15 and November 15. Many businesses file earlier once they've completed their financial calculations and gathered all necessary information. Filing earlier also gives you more time to respond if the Comptroller identifies any issues with your report.
What payment methods are accepted with Form 05-164?
Payment methods depend on your business's size and payment history. Most businesses can pay by check mailed with the paper form, or electronically through the Comptroller's Webfile system. Businesses that paid $10,000 or more in franchise taxes in the previous state fiscal year are required to pay electronically through either Webfile or TEXNET, depending on the specific payment amount. Check the Comptroller's requirements for your specific situation, as mandatory electronic payment rules apply to larger taxpayers.
